Markets Plunge Amid Trumpism Tariff Fears
Wall Street ended the week deep in the red as renewed tariff concerns weighed on investor sentiment.
Stability inspires investors, and over the past weeks with President Donald Trump’s flip-flopping on tariff threats with Canada and Mexico there is little of the stability that savvy investors seek.
While Trump has waffled again on his tariff threats, Ontario Premier Doug Ford is promising a 25% tariff on energy exports from the province. That will impact North Eastern states and contribute to a likely response from Trump.
- S&P 500: -4.76%
- Dow Jones: -3.96%
- Nasdaq: -5.2%
U.S. Treasury yields spiked, with the 10-year yield up 4.28%, fuelled by Germany’s proposed defence spending, triggering a global bond selloff.
Trade War & Economic Impact
- Trump’s Tariffs: A 25% duty on $1.5T in imports from Canada & Mexico while delayed are still threatened, plus an extra 10% on Chinese goods, pushing total tariffs to 20%.
- Canada’s Response: Retaliatory tariffs on $107B in U.S. goods.
- China Strikes Back: 15% tariffs on U.S. agricultural exports.
- Auto Sector Hit: Stocks down 4% as supply chains take a hit.
Recession Risks Rise
- Atlanta Fed’s GDPNow model: Predicts -2.4% contraction in Q1.
- Consumer Confidence: Slumped to 98.3, missing expectations.
- ISM Manufacturing Data: Input costs rising, stoking inflation fears.
- Job Losses: February saw 172,017 layoffs, up 103% YoY, mainly in government, retail, and tech.
Jobs Report & Labor Market
- Non-farm payrolls: +151K (missed estimates).
- Unemployment Rate: 4.1%, up from 4.0%.
- Federal Jobs Cut: -10K, the biggest drop since June 2022.
Sector Performance
- Top Sector: Healthcare (XLV).
- Defensive Sectors Gain: Consumer Staples (XLP) & Real Estate (XLRE) rise as mortgage rates decline.
- Tech Struggles: NVDA fell 6% on tariff concerns.
Crypto Volatility
- Bitcoin (BTC-USD): Briefly surged to $95K before falling to $90K after Trump’s crypto reserve plans.
- Solana (SOL-USD): +21%, Cardano (ADA-USD): +59%.
Currency & Global Markets
- USD Weakens: DXY down 0.8% amid trade tensions.
- Euro Gains: Up 1.2% on ECB rate cuts & German fiscal expansion.
- Stock Divergence: Europe’s STOXX 600 falls, Asian markets rise, Nikkei drops 2.1% on yen weakness.
Chart of the Week
- S&P 500 down 3% YTD, worst Q1 start since 2020.
📉 Uncertainty looms as markets grapple with tariff-driven inflation, interest rate expectations, and weak earnings outlooks.
