MARKETS
Stock Market and Stocks
U.S. stock futures are pointing to a sharply lower opening, with Dow futures plunging more than 1,000 points, after President Donald Trump unveiled his tariff plan after the markets closed on Wednesday.
Trump announced sweeping tariffs of at least 10% on all countries, effective April 5, and even higher levies for some countries. Some of China’s neighbors and biggest trading partners such as Bangladesh, Vietnam, Laos and Cambodia were slapped the highest tariffs. Some multinational companies have moved their supply chains to these countries as they looked to diversify away from China.
Shares of companies like Walmart, Target and Amazon that import a bulk of their goods from Southeast Asia were crushed in after-hours trading.
Investors also fear the tariffs will spark an all-out trade war. Canada, China and the European Union warned they will retaliate with reciprocal tariffs. Economists predict a trade war would push prices higher and slow the economy.
“For the median household, this would represent an annual income loss of $690 while for families in the bottom quintile the loss would surpass $1,000,” said Gregory Daco, EY chief economist. “Importantly, we stress that a significant adverse financial market reaction would exacerbate these shocks and push the US economy into a recession.”
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Daco also stressed that a lot of uncertainty remains, including the duration and potential exemptions and exclusions from these tariffs. “This uncertainty is likely to lead to a wait-and-see approach from businesses and feed market volatility,” he said.
Futures tied to the blue-chip Dow plunged -2.51%, the broad S&P 500 tumbled -3.09%, and the tech-heavy Nasdaq dropped -3.41%.
Corporate news
- RH shares plunge after the luxury home furnishings retailer issued a weaker-than-expected outlook and said it’s facing “the worst housing market in 50 years.” It said in a release “we expect a higher risk business environment this year due to the uncertainty caused by tariffs.”
Medora Lee is a money, markets and personal finance reporter at USA TODAY. You can reach her at [email protected] and subscribe to our free Daily Money newsletter for personal finance tips and business news every Monday through Friday morning.
