NEW YORK: Stock markets and the dollar tumbled Thursday (Apr 3) after President Donald Trump’s latest worldwide tariff salvo fanned a trade war that many fear will spark recession and ramp up inflation.
The dollar slumped by as much as 2.6 per cent versus the euro, its biggest intraday plunge in a decade, and suffered sharp losses also against the yen and British pound.
On stock markets, Wall Street’s tech-heavy Nasdaq Composite dove around 6 per cent, while the retreat in the S&P 500 was its biggest in a day since 2020.
“The simultaneous decline in both stocks and the US dollar speaks volumes about investor confidence in Trump’s trade policy,” said City Index and FOREX.com analyst Fawad Razaqzada.
Shares in apparel companies, which rely on cheap labor in factories abroad, fell sharply with Nike sinking more than 11 per cent and Gap tanking more than 20 per cent.
Apple, whose iPhones are largely manufactured in China, fell over 9 per cent.
Across the globe, shares in major sectors including auto, luxury and banking, also took big hits.
Shares in Jeep-maker Stellantis fell 7.5 per cent after it said it would pause production at some plants in Canada and Mexico as 25 per cent car tariffs came into force.
Tokyo’s Nikkei briefly collapsed more than 4 per cent. In Europe, both the Paris and Frankfurt stock exchanges finished the day with losses of more than three percent.
Oil prices plummeted more than six percent on concerns an economic downturn would hit demand.
Gold, a safe-haven asset in times of uncertainty, hit a new peak of US$3,167.84 an ounce before retreating somewhat.
Yields on government bonds fell as investors fled risky assets and piled into safe-haven treasuries.
