US stock futures have experienced a significant decline of 5%, raising concerns on Wall Street about the potential for another ‘Black Monday’ due to the implications of Trump tariffs. U.S. stock index futures experienced a significant decline on Sunday evening, following Wall Street’s sharpest two-day drop in over five years. This downturn was triggered by President Donald Trump’s announcement of extensive trade tariffs, which heightened concerns about a potential recession and prompted retaliatory responses from major trading partners.
On Sunday, President Trump asserted that his newly imposed tariffs represent the sole solution to address significant trade deficits with China and the European Union, emphasizing that these duties will remain in effect. Concerns among investors escalated as Wall Street appeared poised to experience its most significant single-day drop since the infamous “Black Monday” of 1987, a day marked by a global market crash driven by increased risk aversion. S&P 500 Futures experienced a decline of 4.5%, settling at 4,892.25 points, while Nasdaq 100 Futures saw a significant drop of 5.5%, reaching 16,587.0 points. Dow Jones Futures experienced a significant decline, dropping 3.5% to reach 37,191.0 points.
Last week, President Donald Trump unveiled a 10% universal import tariff, effective April 5. This move is accompanied by plans for additional higher tariffs targeting key trade partners such as China, Vietnam, Japan, and the European Union, scheduled to be implemented on April 9. In a strategic move following the U.S. tariffs, China has enacted reciprocal duties of 34% on American products, escalating the ongoing trade dispute. The European Union is actively pursuing cohesion among its member states to develop a unified response, which may result in further retaliatory actions. The recent developments have intensified concerns regarding a potential global trade war, which could have far-reaching consequences for international commerce and economic stability.
U.S. stocks experienced their most significant two-day drop since the onset of the COVID pandemic, according to third-party sources. Advertisement. This statement does not constitute an offer or recommendation from Investing.com. For further information, please refer to the disclosure here or opt to eliminate advertisements.
The recent announcement has triggered a notable sell-off across global financial markets. The S&P 500 experienced a significant decline of 6% on Friday, marking a loss of over 10% in the final two trading sessions of the preceding week following Trump’s announcement on Wednesday. Last Friday, the Nasdaq Composite experienced a significant decline of 6%, contributing to an overall drop exceeding 11% for the Thursday-Friday period. The Dow Jones Industrial Average experienced a significant decline of over 9% during the final two trading sessions of the previous week, officially entering correction territory. The recent two-day decline represents the most significant drop since the beginning of the COVID-19 pandemic in March 2020.
In a significant update, JPMorgan has increased its forecast for the likelihood of a global recession this year to 60%, up from an earlier estimate of 40%. This adjustment is attributed to the anticipated economic shock impacting markets worldwide. Treasury Secretary Scott Bessent addressed growing concerns regarding a potential recession during an interview on NBC News, confidently dismissing the fears surrounding the economic outlook. On Friday, market participants evaluated the nonfarm payrolls data for March, which reported a significant increase of 228,000, up from the revised figure of 117,000 in February.
In a recent statement, Federal Reserve Chairman Jerome Powell emphasized that there is currently no pressing need for the Fed to adjust interest rates. This comes in light of anticipated inflationary pressures resulting from the Trump administration’s trade policies, which are also projected to hinder economic growth.