Trump administration officials, in talking about his plan for increasing tariffs the last few weeks, acknowledged there might be a “little pain,” at least in the short term.
They were right.
Wall Street felt it right away after President Donald Trump announced his sweeping set of tariffs Wednesday. By Thursday morning, the S&P 500 sank 4.8%, more than in major markets across Asia and Europe, for its worst day since the Covid pandemic in 2020. News reports showed the Dow Jones Industrial Average dropped 1,679 points, or 4%, and the Nasdaq composite fell 6%.
The fall included everything from crude oil to Big Tech stocks to the value of the U.S. dollar against other currencies. Even gold, which hit records recently as investors sought something safer to own, pulled lower, according to the Associated Press. Some of the worst hits walloped smaller U.S. companies, and the Russell 2000 index of smaller stocks dropped 6.6% to pull more than 20% below its record, the AP reported.
Trump announced what he called a “baseline” tariff, a minimum of 10% on imports, with the tax rate running much higher on products from certain countries.
If Trump follows through on his tariffs, it could get worse, experts say.
“Markets may actually be underreacting, especially if these rates turn out to be final, given the potential knock-on effects to global consumption and trade,” Sean Sun, portfolio manager at Thornburg Investment Management, told the AP.
Trump shrugged off Wall Street’s reaction. He was asked about it as he left the White House headed for his golf club in Florida Thursday.
“I think it’s going very well,” he said. “We have an operation, like when a patient gets operated on and it’s a big thing. I said this would exactly be the way it is.”
All told, the S&P 500 fell. 274.45 points to 5,396.52 The Dow Jones Industrial Average sank 1,679.39 to 40,545.93, and the Nasdaq composite tumbled 1,050.44 to 16,550.61.
In stock markets abroad, indexes fell sharply worldwide. France’s CAC 40 dropped 3.3%, and Germany’s DAX lost 3% in Europe.
Japan’s Nikkei 225 sank 2.8%, Hong Kong’s Hang Seng lost 1.5% and South Korea’s Kospi dropped 0.8%.
