Trump Announces Aggressive Tariff Plan: Market Reacts

Global Markets Face Pressure Amid New Trade Policies

President Trump’s “Liberation Day” announcement today introduced a sweeping tariff policy, including a 10% baseline tariff on all imports, along with much higher duties for specific nations. The reciprocal tariffs are particularly steep for China (34% additional, bringing the total to 54%), Taiwan (32%), Vietnam (46%), and the European Union (20%). Canada and Mexico remain exempt for now, though 25% tariffs on autos are set to take effect tonight.

Markets reacted sharply to the news, with equities selling off after hours - S&P 500 and Nasdaq fell more than 2% and 4%, respectively, while major tech stocks like Apple (AAPL), Amazon (AMZN), and Tesla (TSLA) lost more than 5% in after-hours trading. Analysts have noted that this tariff announcement is worse than most had anticipated, and concerns about inflation and Fed policy uncertainty are now at the forefront of investor sentiment.

In the coming days, trade and inflation uncertainties will likely dominate market discussions, with analysts watching closely for reactions from global trade partners and the potential ripple effects on corporate earnings. The market is now pricing in a more aggressive Fed rate-cut path, with a first cut expected as early as June. Investors should brace for heightened volatility and rising inflation concerns in the months ahead.

Stay tuned for more updates as the situation develops and we continue to track the impact on the markets.