By
investopedia
U.S.
stock futures fell sharply on Sunday evening as the Trump administration showed
no signs of backing off from a wide-ranging plan to impose tariffs.
Futures
tied to the Dow Jones Industrial Average were recently down 2.2%, pointing to a
decline of more than 800 points at Monday's open, while futures linked to the
S&P 500 and Nasdaq fell 2.7% and 3.4%, respectively. Dow futures had been
down more than 1,600 points at one point Sunday evening,
The
major indexes are coming off their worst week since the early days of the Covid
pandemic in March 2020, after stocks plunged on Thursday and Friday following
President Trump's announcement of sweeping tariffs on U.S. trading partners.
The benchmark S&P 500 declined 10.5% over the last two days of the week,
while the Dow shed nearly 4,000 points.
White
House officials provided no indication over the weekend that the president
would consider scaling back on the tariffs. The so-called reciprocal tariffs
that Trump announced on Wednesday— which include new levies of 20% on imports
from the European Union, 26% on Japanese imports, and 34% on imports from
China—are due to take effect on Wednesday.
The
Trump administration, which has also indicated more sector-specific tariffs are
coming, says the measures are needed to restore competitive balance and bring
manufacturing and jobs back to the U.S. However, the speed and depth of the
policies announced in recent weeks—and the prospect that countries will
retaliate, as China did on Friday—have heightened concerns among economists and
investors that the economy could slide into a recession.
Speaking
Friday, Federal Reserve Chair Jerome Powell said that the tariffs announced
last week were higher than expected and raise the risks both of inflation
rising and economic growth slowing. Powell said the Fed is awaiting greater
clarity on the impact of Trump's policies before considering adjustments to
interest rates.
Asian
stocks also tumbled to kick off their week amid fears of the consequences of a
trade war, with Hong Kong's Hang Seng index down 9%, while Japan's Nikkei 225
dropped 6% and South Korea's Kospi index and Australia's S&P ASX 200 each
fell more than 4%.
Bitcoin
was also down sharply Sunday, tracking the move lower in equities as investors
abandon risky assets. The digital currency was at $78,700 recently, down from
an earlier high on Sunday of nearly $84,000 and trading at its lowest levels
since early November.
Crude
oil prices also retreated amid the growing concerns about slowing global
demand. West Texas Intermediate futures, the U.S. crude oil benchmark, fell
2.6% to $60.40 per barrel, after falling as low as $59.38, their lowest level
since last April.
