The storm does not love. They ended last week is still installed on the bags on Monday. After the indices suffered the greatest collapse from the pandemic, the losses are accentuated: European futures and those of Wall Street fall more than 3%, Asian bags suffer bataczos of more than 6%, the dollar weakens against the euro, oil drops 2%. China announced on Friday a battery of tariffs against the United States, in response to those set by Trump against Chinese products. The commercial war has reached a global scale ,.
During the weekend, investors did not receive the news they expected: silence around possible advanced negotiations by the Donald Trump government with countries to reduce commercial rates, or at least, delay their entry into force. If nothing avoids it, the tariff barrage that the US president announced last Wednesday will begin to apply on April 9. From this Friday, April 5, the minimum tariff of 10% is already used and in two days the specific ones will be done to each country. According to the White House, more than 50 countries affected by the tariff policy have wanted to speak with the president to negotiate the taxes, but no solid proof that these conversations are being carried out, at least seriously.
The futoxx 50 index futures are left 3.5% and point to a new collapse at the opening on Monday. Dax fururos fall 4% and those of the British FTEse, 2.3%. In New York, Dow Jones are left 2.8%, those of the S&P 500 lose 3.6%and those of Nasdaq yield 4.6%. Between Thursday and Friday, Wall Street suffered a fall of more than 10% and evaporated (about 4.5 billion euros), more than the annual GDP of Spain and France together.
Far from appeasing the spirits and looking for approaches, the US president reduced this weekend to the sales wave and remained firm in his plan. Trump said Sunday that although he doesn’t want to “go down,” sometimes “you have to take medications to solve something.” The president added that with a commercial deficit of one billion dollars with China, the United States loses “hundreds of billions of dollars a year” with the Asian giant. “And unless we solve that problem, I will not reach an agreement,” he said. For his part, the Secretary of Commerce, Howard Lutnick, declared that tariffs will not be postponed. “Tariffs are arriving. They will definitely remain in force for days and weeks,” he said in statements to the CBS television network.
In Asia, Tokyo’s Nikkei index is left 6.57% and the main index of the Hong Kong Stock Exchange, the Hang Seng, which remained closed on Friday by festive, falls about 10% after the. Beijing will impose tariffs of 34% to all products in the United States, as a response also 34% imposed Washington and reaches 54% if the 20% rates are added previously imposed on Chinese products. The Shanghai compound index falls 6.5%.
“One of the problems is that people expected some kind of comment during someone’s weekend that indicated a possible negotiation or perhaps a change in tariffs. But they seem to be determined,” says Robert Pavlik, Dakota Wealth’s manager, according to Reuters. In addition, investors also show nervousness due to the fact that the Federal Reserve “said will remain waiting until it has more clarity. If the Fed does not come to the rescue, who else will do it?”, He adds.
On Friday, the president of the Federal Reserve, Jerome Powell, lit the alarms on tariffs, although he avoided specifying the consequences in monetary politics, claiming that it was “too soon to say it.” According to Powell, it is “time to wait and see”, a position that was later criticized by Trump. Despite caution, the market gives 54% probability to the Central Bank cut the price of money at its May meeting,
“The lack of a political response by the Trump administration in the face of market fall increases uncertainty. Unless we see a clear change by political leaders, it is likely that volatility remains high and that the lowest resistance of risk assets remains downward,” says Charu Chanana, Saxo Investment Head of Saxo.
The shaking also reaches debt. The market already discounts five cuts from a quarter percentage point in US interest rates this year, which has sunk profitability yields of treasure bonds. The 10 years lowers another 6 basic points and listed below 4%, at 3,925%. The German at that period closed Friday at 2,569% and Spanish, at 3,264%.
Given the prospects for economic braking and the greatest forecasts of interest rates, the dollar remains weak against the rest of the currencies. Each euro costs today $ 1,099.
Petroleum also suffers from the bad perspectives of the economies of the great powers. The crude falls another 2% and the Brent barrel costs $ 64.13, in minimums since 2021.
“The only decisive factor is President Trump’s iPhone, who shows few signs that the market sales wave bothers him enough to reconsider a political stance in which he has believed for decades,” says Sean Callow, senior division analyst of ITC Markets. Meanwhile, to Trump’s commercial wall. “The commercial relationship between the EU and the United States needs a new approach,” said the European Union jobs on Friday, Maros Sefcovic, after meeting with his US counterpart.
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