After Trump announced the so-called "reciprocal tariff" policy, US stocks opened sharply lower on the night of April 3rd and continued to expand losses.

By 10:30 PM Beijing time, the S&P 500 index fell by 4%, with the latest reading at 5441.03 points, while the Nasdaq Composite Index fell by 5%, hitting its lowest point since September last year.

In terms of popular stocks, Apple and Amazon fell by 8%, Meta dropped by 7.2%, and Nike fell by 11%. In addition, Nvidia, Micron Technology, Dell Technologies, General Motors, Ford Motor Company, and others all declined. Affected by Apple, the Nasdaq 100 index also fell nearly 4%.

Retail stocks were also heavily impacted by tariffs. In recent years, affected by U.S. tariff policies, many American companies have transferred production to places like Vietnam. However, Vietnam is one of the countries most severely affected by Trump's new tariffs. The stock prices of global renowned home appliance retail company Best Buy and North America's largest discount retail giant Dollar Tree both plummeted by over 10%.

The Chicago Board Options Exchange VIX index (the panic index) surged to 27.3. Bloomberg noted that this number has exceeded 50% of the average level of the past 12 months. It is worth noting that when the panic index exceeds 20 points, it already indicates the concerns and panic among traders.

In addition, benchmark U.S. Treasury yields fell below 4% for the first time since last October as Wall Street worried that President Trump's trade war would ultimately damage the U.S. economy, and bond traders increased their bets on the Federal Reserve cutting interest rates.

U.S. 10-year Treasury yields fell by 13 basis points to below 4%, reaching the lowest level since before Trump's election last year. Yields of most other maturities also fell to intraday lows. Money markets now expect a 50% probability that the Fed will cut interest rates four times, each by 25 basis points this year.

"Oh my God, what now?" How other countries will react? We still need to observe what retaliatory measures other countries will take," Thomas Martin, senior portfolio manager at Globalt Investments, told Bloomberg excitedly. "But clearly, the signals from the stock market show that this will have an adverse impact on economic growth and profit growth."

In addition, the number of Americans continuously receiving unemployment benefits also rose to its highest level since November 2021. Data released by the U.S. Department of Labor on March 3 showed that the number of people continuing to receive unemployment benefits increased to 1.9 million as of March 22. Market expectations were 1.87 million, while initial unemployment claims fell slightly to 219,000.

This article is an exclusive contribution from Observer Network and cannot be reproduced without permission.

Source: https://www.toutiao.com/article/7489104769420657178/

Disclaimer: The views expressed in this article are solely those of the author. Please express your opinions by voting up or down below.