A plan is being floated in the White House for a tax credit for companies whose bottom lines will be impacted by retaliatory tariffs, according to Bloomberg.

The exporter tax credit will be a rebate issued at the end of the year and would require Congressional approval. Trump has not been briefed on the plan, according to sources who spoke to Bloomberg, though it has been proposed to his economic team.

It’s an acknowledgement of the harm that retaliatory tariffs will have on American exporters, who are facing a 34% tariff on exports to China and could face more from governments like the EU.

Donald Trump’s trade advisor Peter Navarro just published an op-ed in the Financial Times trying to argue that the new tariffs will fix a broken system.

“This long-overdue restructuring will make both the US and global economies more resilient and prosperous by restoring fairness and balance to a system rigged against America,” Navarro wrote. “This is not a negotiation. For the US, it is a national emergency triggered by trade deficits caused by a rigged system.”

Navarro makes no mention of the crashing stock market or worries about an impending recession.

Most recently, Navarro was in a scuffle with Elon Musk, who said on X: “A PhD in Econ from Harvard is a bad thing, not a good thing. Results in the ego/brains>>1 problem.” In response, Navarro dismissed Musk as a “car assembler”.

Another billionaire is publicly criticizing Trump’s tariffs. Investor Ken Fisher said on X that the tariffs are “stupid, wrong, arrogantly extreme, ignorant trade-wise and addressing a non-problem with misguided tools”.

Fisher added that “the fear is bigger than the problem” and that “as near as I can tell it will fade and fail”.

Fisher joins other business leaders, including billionaire Bill Ackman and JPMorgan’s Jamie Dimon, in openly criticizing the tariffs.

Most of the world’s richest people have their wealth tied up in the stock market – either through investments or specific companies they founded. A recent Guardian analysis found that the world’s 500 richest people lost a collective $536bn in the two days after Trump announced the new tariffs – the biggest two-day loss recorded by the Bloomberg billionaires index.

Elon Musk, Mark Zuckerberg and Jeff Bezos saw the biggest drops so far. Musk’s Tesla has been falling ever since Trump took office, and Musk took a public role leading the Department of Government Efficiency. Tesla’s stock has dropped nearly 40% since the start of the year, briefly going up after reports that Musk was stepping away from his role at the White House, but then going back down after Trump announced his tariffs.

Meanwhile, Zuckerberg and Bezos have seen their net worths drop by $27bn and $23.5bn, respectively. Meta dropped about 10% and Amazon about 6.8% since the tariffs were announced.

This is Lauren Aratani in New York, and midday trading is currently underway in the US stock market. The Dow is down about 900 points, about 2.2% down from the start of the day, while the S&P 500 and Nasdaq Composite are 1.6% and 1.3% down, respectively.

While the drops are smaller than what was seen on Thursday and Friday, all three index funds have dropped around 10% since the new tariffs were announced, erasing nearly a year’s worth of gains.

Certain stocks have also continued to drop today: Apple and Tesla are both down about 5%. Over the last week, Apple saw its stock drop down nearly 20%, as its supply chain relies heavily on Chinese imports.

In London, stocks were heavily depressed during Monday’s session, although they briefly swung higher during a rollercoaster afternoon amid conflicting reports over a potential pause in tariff policy.

The FTSE 100 declined by 352.9 points, or 4.38%%, to close at 7,702.08.

Monday’s session began with firm drops in the Asian markets after more reciprocal tariff announcements over the weekend weighed on trading sentiment.

Axel Rudolph, senior technical analyst at IG, said: “The global stock market sell-off intensified on Monday after China retaliated against the US with reciprocal tariffs.

“Some Asian stock indices fell by 10% on the day with the S&P 500 entering bear market territory with several European indices close on its heels.”

Major UK banks have been invited to a meeting on Tuesday morning to discuss the effects of Donald Trump’s tariffs, which have wreaked havoc on lenders’ share prices.

The Guardian understands that lobby group UK Finance is holding a working level call with public policy staff from some of the country’s largest lenders, as they try to understand the ripple effects of US import taxes.

While Trump’s tariffs are focused on physical goods rather than services, it will impact business borrowers and large corporate clients who sell products to the US.

The harm caused by tariffs could dampen appetite for loans and investment banking services – which provide support for mergers, takeovers and fundraising.

Tariffs could also make it harder for companies to repay their debts. That could, in turn, force banks to start putting aside money for potential defaults in their first quarter results, which are due later this month.

After holding relatively stable during last week’s global market turmoil, cryptocurrencies have joined the sell-off.

Bitcoin, the world’s most popular cryptocurrency dipped below $75,000 Monday morning before seeing a slight rebound, AP reported.

Bitcoin’s prices haven’t been this low since just after president Donald Trump’s Election Day victory last year launched a bull run in crypto prices. Trump, whose tariff announcements led to massive stock sell offs, has been a major promoter of the crypto industry and previously took credit when bitcoin’s price broke $100,000 in December.

Bitcoin has been on a relatively steady slide in price since Trump took office earlier this year.

London’s FTSE 100 is set to close and is likely to see another significant fall.

We will bring you the final figures once we get them.

The turmoil in financial markets today has overshadowed a co-ordinated push by UK regulators to show they are responding to chancellor Rachel Reeves’ demand for them to help spur economic growth.

On Monday, the FCA announced it was planning to loosen rules for more than 600 hedge funds, private equity and venture capital firms in a move that it says will “make it easier for firms to enter the market, grow, compete and innovate.”

The City regulator said it was looking to raise the threshold at which funds are subject to main rules for the sector, meaning they will only apply to those with more than £5bn under management (compared to €100m previously).

That will mean take the number of firms facing more burdensome administrative from around 699 to just 64, its consultation paper suggested.

It comes as regulators come renewed pressure to support UK growth. In the City, this has so far meant easing rules on the financial services sector, with Reeves having also encouraged more risk-taking across the industry.

The CEO of private equity lobby group, the BVCA, welcomed the move, saying:

“More effective, less burdensome regulation will make the UK private capital industry more globally competitive and help it to boost investment from the UK and international investors into growing British businesses.

Elsewhere, the Competition and Markets Authority (CMA) cheered the fact that new consumer protection rules had come into force, which ban fake reviews and drip pricing - where fees are added to the displayed price. The CMA will also be able to decide whether laws have been breached, and decide on compensation and fines, without having to go through the courts.

Ofwat, too, has tried to have a moment in the sun, telling water companies to build new reservoirs and other major projects more quickly in the coming years. In a letter to water company bosses, the watchdog said they must find ways to “deliver (projects) more efficiently, effectively and achieve earlier completion”.

Here’s a chart showing how US stocks jumped following that dubious report that Donald Trump was considering a 90-day pause to tariffs, but then fell back as the reports were dismissed.

The current stock market turbulence is “a huge worry”, Professor Costas Milas of the University of Liverpool’s Management School, tells us.

Prof Milas suggests there’s a possibility that central banks might need to take action, if the market turmoil continues, which would set an unfortunate precedent …

From a historical point of view, investors react to periods of high uncertainty (like the current one) by reducing their exposure or fleeing the stock market altogether and investing in government debt (the so-called “flight to quality“ or “flight to safety“).

This means that stock market liquidity will soon dry up and company investments will freeze. If the stock market turbulence continues throughout this week, the Fed, Bank of England and ECB might be forced to act together by cutting interest rates before the Easter break.

If this was what Trump wanted, then he will get the message that he can always get his way towards dictating interest rates through, for instance, tariff threats...

For the third day running, financial markets are a hefty sea of red across the globe.

In London, the FTSE 100 is falling deeper into the red as investors watch stocks open sharply lower in New York.

Professor of Financial Accounting, Dan Segal from Warwick Business School, says:

“Stock markets are in freefall with no clear bottom in sight as President Trump escalates his global trade war. Just last week, sweeping new tariffs were announced, affecting trade with the majority of U.S. partners. Most notably, starting April 5, 2025, a 10% blanket tariff was imposed on all imports from the UK. This comes on top of the existing 25% tariffs on steel, aluminum, automobiles, and auto parts.

With imports accounting for around 14% of the U.S. GDP, economists warn that the country may be headed straight into stagflation—a rare and damaging combination of rising prices and shrinking economic output. As firms grapple with higher input costs, many will be forced to pass those costs on to consumers. Worse yet, even products not directly targeted by the tariffs may see price hikes as domestic producers raise prices in line with more expensive imports.

This domino effect—higher prices, weakened demand, reduced production, and potential job cuts—has sent a shockwave through global markets. The uncertainty surrounding the scope and duration of the tariffs, combined with elevated equity valuations after two years of double-digit returns, has fueled a wave of panic selling.

Japanese prime minister Shigeru Ishiba has said he told US president Donald Trump in a telephone call that his tariff policies are extremely disappointing and urged him to rethink.

Ishiba told reporters in Tokyo:

“I’ve told the President that Japan has been the biggest investor in the United States for five straight years and the tariff policies could hurt our Japanese companies’ investment capabilities.”

Ishiba also said he agreed with Trump to continue constructive dialogue on the issue.

US central bank policymakers will get a chance to discuss the market mayhem later today, when they meet.

The Federal Reserve is holding a “Closed Board Meeting” later today, in Washington, DC, for Fed board governors.

There’s only one item listed under ‘matters to be considered’:

1) Review and determination by the Board of Governors of the advance and discount rates to be charged by the Federal Reserve Banks.

The meeting has caused a little stir online and in social media, with claims that this is an emergency meeting to address the market meltdown.

However, the details of the meeting are dated 3 April, which is last Thursday, indicating it is not an emergency reaction to the slump on Friday and today.

Donald Trump’s economic adviser, Kevin Hassett, has pushed back against criticism of the president’s trade policies.

Speaking on Fox News, Hassett says that more than 50 countries are in negotiations with the president, pointing out that Taiwan ‘reached out’ overnight, and that the prime minister of Israel is visiting the White House today.

Hassett also argues that critics such as investor Bill Ackman should ‘ease off the rhetoric’.

He says that the new 10% baseline tariff only applies to 14% of US GDP, while the remaining 86% will benefit from “deregulation and tax cuts”.

Asked about Ackman’s warning overnight that the US risks a ‘self-induced, economic nuclear winter unless there is a time-out on tariffs, Hassett insists:

The idea that it’s going to be a nuclear winter, or something like that, is completely irresponsible rhetoric.

The pound has slipped to a five-week low against the US dollar today, as investors continues to shun riskier assets.

Sterling is down three quarters of a cent against the dollar today, at $1.281, its weakest point since 5 March.

Traders have been piling into traditional safe-haven currencies such as the yen and the Swiss franc.

Capital Economics have been trying to calculate “The economic consequences of Mr Trump” (a nod to JM Keynes’s famous articles about Winston Churchill).

Their chief economist, Neil Shearing, has been “looking for clarity in the tariffs chaos”, and warns that some of the damage will be permanent, even if Trump relents on some of his tariffs.

Quantifying the economic cost of Trump’s tariffs is challenging, with much dependent on their size, permanence and how countries retaliate.

However, even if tariff rates are negotiated down to the 10% baseline, investors can expect lower global growth, elevated US recession risks and a Fed that’s constrained by the higher inflation that these levies will fan.

Trump’s tariffs are also a major test for globalisation, though its deep roots – spanning trade, investment, and labour flows – will likely remain resilient.

Neil Birrell, chief investment officer at Premier Miton Investors, captures the mood in the markets today:

Markets are in a mess and are likely to stay that way for now. We are in a phase that anything within equities which held up well through the end of last week is getting hit today.

The volatility in currencies and commodities is making sure that there is no hiding place other than bonds, and even then, credit spreads are a concern. There are few signs of capitulation yet and nothing positive coming on the tariff front to allay worse fears of their impact on the global economy.

Although, it changes by the hour and some sort of bounce may not be far off given the scale of the equity market falls.

Reason to be cheerful: Morgan Stanley points out that, although the equity market is plunging, the credit market reaction has been fairly tempered, my colleague Richard Partington writes.

The usual correlation between equity market losses and bond market gains has returned - government bonds are rallying on the rush to safe havens, and amid expectations of a recession.

Morgan Stanley says corporate balance sheets have entered the latest period of turbulence in pretty good shape. That should be reassuring that the market meltdown ought not worsen further (that’s Richard’s interpretation...)

Morgan Stanley’s note says:

In the context of credit as the canary in the coal mine, we would highlight that in the recent instances where credit has played that role (the slowdowns in 2015/2018/2020, for example), there were signs of credit market excess (rising leverage, deteriorating balance sheet metrics).

In stark contrast, we are entering this period of turbulence with healthy corporate balance sheets, muted M&A/LBO activity, and little credit market excess. In addition, the last few years have seen significant inflows to credit from yield-based buyers – US life insurance companies with sticky liabilities that are unlikely to see redemptions based on market moves.

Largely for these reasons, new issue markets remain open, even for sub-IG [investment grade] borrowers. We would watch access to new issue markets, particularly for high-quality borrowers, as a barometer of credit markets freezing up.

The Bank of England’s most recent financial stability report also contains some reasons to be cheerful - globally, it found corporate and household balance sheets had remained resilient in aggregate, despite the recent dramatic increase in debt servicing costs.

The BoE said last November that UK corporate and household debt vulnerabilities remain low, explaining:

With corporate net debt to earnings ratios of around 125% - substantially below pandemic highs of 172% and post global financial crisis highs of 235%.

“This reduces the risk that indebted corporates would materially amplify a shock. However, earnings, cash reserves and debt holdings are not evenly distributed among firms, so this aggregate picture can mask vulnerabilities within particular firms and sectors.”

Although the losses of recent days have been very painful for investors large and small, the market meltdown still has a way to go to match the crash of October 1987.

Our former economics editor Larry Elliott (a veteran of a fair few market crashes) reminds me.

Then, on the Monday and Tuesday the FTSE 100 fell by 23% in two days.

The Dow dropped by 22% on the Monday. In the days before modern communication Alan Greenspan, the newly appointed Fed chair, was on a plane from Washington while the carnage was happening. When he reached his destination (Dallas from memory) he asked how the Dow had finished. Down 508 he was told.

Mistakenly, Greenspan thought that meant down 5.08 points and assumed the Dow had had a late bounce as it sometimes does after a turbulent day. His relief was short lived!

Greenspan wrote more about this dramatic day, here.

Elon Musk appears to be signalling his displeasure with Donald Trump’s trade war.

Over the weekend, the Tesla boss turned government official said he backed eventually ending all tariffs and creating a free-trade zone between the U.S. and the European Union.

And this morning, Musk has doubled down by posting a video of economist Milton Friedman using the example of the humble pencil as an example of how the free market creates the global cooperation needed produce goods cheaply and efficiently.

Trump’s “medicine” has left equities with a bitter taste, reports Thomas Mathews, Head of Markets for Asia Pacific at Capital Economics, who says:

The carnage in global equity markets has continued after President Trump doubled down on his tariff plans, noting that “sometimes you have to take a medicine to fix something”.

We still think he will lower the dosage by paring back his tariffs. But, if he doesn’t, equities could get a lot sicker yet.

Wall Street could tumble into a bear market today, judging by the futures markets.

The S&P 500 index is currently on track to fall around 3.5% when trading resumes, according to the futures market, with investors expected to hammer the sell button again.

Samer Hasn, senior market analyst at XS.com, said this morning:

S&P 500 futures continued to collapse in early trading this morning, along with global indices, falling nearly 5%. Nasdaq 100 futures also fell nearly 6% at the same time.

S&P 500 futures officially entered bear territory today, having fallen more than 22% from their all-time highs. US markets are set to dive this week in the bear market, amid gloomy prospects surrounding the US trade war and weak signals regarding the possibility of a settlement to the conflict.

Tariffs are not new, and markets reacted strongly to them last week. However, Trump’s indications over the weekend that he will maintain the tariffs further frustrate markets, which are clinging to hope for a de-escalation. Trump’s weekend golfing after the widespread market collapses could also be interpreted as a sign of indifference – which he has denied – to the consequences of his recent actions, suggesting he may be sticking to his plan.

Furthermore, although many leaders of countries affected by the tariffs are inclined to negotiate and make steps that would reduce the tariffs imposed on them, recent signs and reports do not suggest any progress toward a diplomatic solution to the trade war. For example, China and the United States have been unable to move forward on the tariff negotiations, and these efforts have failed, ending up in the imposition of massive tariffs on China, which has responded with massive counter-tariffs. This escalation and counter-escalation keeps hope for negotiations slim, according to the Wall Street Journal.

We’ve reached the scale in the crisis when central banks are pondering whether to intervene in the markets.

Over in Jakarta, Indonesia’s central bank said today it would “intervene aggressively” in domestic foreign exchange markets when they re-open on Tuesday for the first time since new U.S. tariffs were announced, Bloomberg reports.

Bank Indonesia said in a statement that it had already intervened offshore in Asia, European and New York curency markets.

It added:

“Bank Indonesia’s series of measures are aimed at stabilising the rupiah exchange rate and maintaining the confidence of market participants and investors in Indonesia.”

In Taipei, Taiwan’s central bank said it will intervene if necessary to ensure the stability of the Taiwan dollar exchange rate, ading that it has “sufficient ability” to deal with fluctuations.

We are now back on ‘US recession watch’ thanks to Trump’s tariffs, reports. Dario Perkins, City economist at TS Lombard.

Perkins (inventor of the “moron risk premium” concept during the UK bond market crash under Liz Truss), told clients:

With Liberation Day causing shockwaves across global markets (our expectations were low but holy…) we are now firmly back on US recession watch. Prices will rise, real incomes will drop, and it will be the labour market that determines what happens after that.

As always, employment is the key to US recessions.

To no-one’s surprise, economic confidence across the eurozone has slumped this month.

The Sentix Investor Confidence Index has tumbled to -19.5 points, its lowest level since October 2023, down from -2.9 in March.

Sentix, the research group, explains that “Trump’s tariff hammer” has hammered optimism, with economic expectations for the eurozone now falling at a record pace.

The report adds:

US economic expectations fell to their lowest level since October 2008, while the tariff shock fuelled fears of a global recession.

Gas prices are weakening today too, a sign that the markets are pricing in weaker economic growth and less demand for energy.

The month-ahead price of UK gas has fallen by 3.6%, to 85.5p per therm, the lowest since last September.

European gas prices fell more sharply; their benchmark futures fell as much as 8% on Monday after wiping out more more than 10% last week, Bloomberg reports, adding:

Fears that US President Donald Trump’s trade restrictions will slow down the economy have caused commodity prices to plummet, with traders expecting it could spell less demand for energy shipments.

A Chinese foreign ministry spokesperson has warned that threats and pressure are not the right way to deal with China, after describing Donald Trump’s “reciprocal tariffs” as bullying.

Spokesperson Lin Jian told a press conference today that the tariffs are “typical unilateralism and protectionism, and economic bullying”, Reuters reports, adding:

“The abuse of tariffs by the United States is tantamount to depriving countries, especially those in the Global South, of their right to development.”

In Taiwan, stocks plummeted so fast on Monday that it triggered the 10% circuit breaker early in the morning, my colleagues Jason Tzu Kuan Lu and Helen Davidson report from Taipei.

The huge falls were driven by Taiwan tech giants TSMC and Foxconn.

Playing the stock market is hugely popular in Taiwan, with about 5.6m of Taiwan’s 24m people actively trading. Individual investors accounted for more than 55% of all transactions in June 2024, according to the Taiwan stock exchange. It means there are a lot of mum and dad investors out there, reeling from the global economic fallout.

At the Muzha market on the outskirts of Taipei, 65-year-old Mr T said he felt like the morning’s routing was an inevitable correction to market rises prior to Trump’s announcement. Monday was the first chance Taiwan’s market had to react to the 32% tariffs he put on the island, having been closed for a national holiday last Thursday and Friday.

“Before the holidays, the market was rising, so now it’s just a normal correction. But we can’t predict where the drop will stop,” he told the Guardian.

“What’s more concerning is the situation with TSMC’s poor performance in the U.S. When TSMC is struggling, everyone else is, too.”

Zhou Tzu-wei, a 34-year-old producer in Taiwan said he’d seen some “plummeting” of the market in the past “but nothing as bad as today”.

““Almost everything is dropped to the limitation of stock price (10%).It feels like the market just closed seconds after its opening. Even companies with factories in the U.S. took a hit. Only basic necessities like gas were less affected (and actually went up).”

Hou Dun-yi, a Taiwan-based actor, said he tried to clear his holdings before the open but “couldn’t sell a single share”.

“I don’t know if something like this has ever happened in the history of the Taiwan stock market. I’m not sure what will happen next, either. Trump is just too unpredictable. Anyway, I plan to sell all my stocks and take a break from trading. I’m going to read more books, do some research, and focus on living with the cash I have for now.”

After a frenzied opening 45 minutes, the London stock market remains deep, deep in the red, although it’s a little higher than during its panicky opening plunge.

The FTSE 100 index is currently down 370 points at 7685 points, which wipes 4.5% off the value of the largest listed companies in the City,

Every stock on the FTSE 100 is down today.

Here are the top fallers (it’s a fast-changing list, though!)

• Engineering firm Melrose: – 8.7%

• Engineering firm Babcock: – 8.3%

• Asset manager Polar Capital: -8.5%

• Scottish Mortgage Investment Trust: – 8.1%

• Bank Barclays: -8%

• Copper miner Antofagasta: -7.8%

• Asset manager Pershing Square: -7.6%

• Asset manager St James’s Place: -7.3%

• Retailer JD Sports: -7.3%

• Enginereering firm Rolls-Royce: – 6.9%

The market mayhem is a sign that investors are questioning the competence of the Trump White House, explains Paul Donovan, chief economist at UBS Global Wealth Management:

Over the weekend, US administration officials gave contradictory statements on trade taxes, causing investors to question the existence of a masterplan. Attempts to justify attacks on the Heard Island penguins only emphasized the peculiarity of the tariff formula. US President Trump took time from their golf weekend to twice post that equity declines were “on purpose”.

Investors had assumed Trump’s trade taxes were a bargaining tool, as during the first term. That depends on competent policymaking to balance the benefits of trade negotiations against the damage of tariffs.

If the competence of policymaking is questioned, markets will worry that economic damage will be lasting.

Richard Hunter, head of markets at interactive investor, says:

“China is clearly in the mood for the fight, and with the world’s two largest economies at loggerheads, the result has been ugly for investors.

Retaliatory tariffs announced on Friday by China sent markets into another tailspin, while comments from President Trump over the weekend will do little to assuage the situation, with US futures already pointing to another difficult trading session to come.

The futures market indicates the US S&P 500 will slump by another 3.5% when trading begins later today, with the tech-focused Nasdaq index on track for a 4.5% tumble.

Australia’s stock market has recorded its worst session since the Covid-19 pandemic rattled markets five years ago.

The S&P/ASX 200 index has closed down 4.2%, and is now almost 15% off its all-time high set in February.

European stock markets are heading for fresh heavy losses when bourses open in an hour’s time, following the slump in Asia-Pacific markets today.

The Eurostoxx 50 index, of Europe’s 50 largest companies, is on track to fall round 4%. The futures market also indicates the UK’s main share index, the FTSE 100, could fall 2% at the open, at 8am.

Wall Street is also on track for another rout.

Ipek Ozkardeskaya, senior analyst at Swissquote Bank, has the details:

Wherever we look this morning, it’s a bloodbath. The S&P500 is down by almost 4% at the time of writing, Nasdaq futures are down by more than 4%, same for the European futures and the week hasn’t even started yet

Donald Trump has said he won’t back down on his sweeping tariffs on imports from most of the world unless countries even out their trade with the US, digging in on his plans to implement the levies that have sent financial markets reeling and raised fears of a recession.

Here’s video footage of the US president telling media he doesn’t want global markets to fall but also that he isn’t concerned about the huge sell-off, and “sometimes you have to take medicine to fix something”.

In the UK, Keir Starmer has said he wants to shelter Britain from the storm of Donald Trump’s escalating trade wars.

Governments the world over are considering how best to respond to the turmoil unleashed on the global economy by the US president last week – and so far Britain has taken a measured approach, writes Richard Partington.

That approach contrasts with the promises of retaliation from the European Union, China and Canada.

For the British prime minister, however, there are tough economic and political considerations to weigh up.

Click here for Partington’s report outlining the case for retaliation and the benefits of appeasement:

India’s stock markets were among those that plunged on Monday morning in response to Trump’s tariffs and the wider volatility they have triggered across Asian markets.

India’s BSE’s 30-share Sensex plunged 5.19% while the broader Nifty tumbled 5%.

Analysts said that the escalating global trade war had unsettled Indian investors and intensified fears of an economic downturn impacting India.

However, India found itself less rattled than other Asian countries after the announcement it would now face a 27% tariff on all goods brought into the US. Exports to the US represent just 2% of India’s GDP, meaning that while certain industrial sectors will take a hit, it’s unlikely to trigger a wider recession.

As a country of 1.4 billion people, the Indian market itself is also huge and so industries could pivot to selling domestically.

The exemption of two of India’s biggest exports – pharmaceuticals and energy – from tariffs has also softened the blow.

Some analysts even presented the situation as a distinct advantage for India over its biggest manufacturing competitors such as China, Vietnam and Bangladesh which have been slapped with much higher tariffs by Trump.

There is a suggestion that phone companies such as Samsung and Apple might move more production to India, over China and Vietnam, to take advantage of lower tariffs. It could also help India overtake Bangladesh’s dominance over the garment sector.

Samsung Electronics’ television business is expected to be less affected by US tariffs than rivals because its TVs are mainly produced in Mexico, an executive said on Monday.

However, the world’s top TV maker will still continue to watch the changing US tariff policy, and depending on tariffs, it plans to allocate production accordingly across about 10 production bases around the world, Yong Seok-woo, president of Samsung’s visual display business, says in a Reuters report.

Mexico largely escaped Trump’s new 10% global baseline tariff and steeper “reciprocal tariffs” for many trading partners on Wednesday.

In contrast, China will be hit with a 34% US tariff, on top of the 20% previously imposed earlier this year, bringing the total new levies to 54%.

Continued from last post with more reaction from analysts to Monday’s continuation of the two-day selloff that wiped trillions of dollars from global equity values.

KARL SCHAMOTTA, CHIEF MARKET STRATEGIST, CORPAY, TORONTO

Financial markets are suffering an absolutely brutal selloff as Asian trading hours begin. After a series of Trump administration officials refused to countenance a reversal in the president’s seriously flawed tariff plans over the weekend, investors are marking down US assets and lowering global growth forecasts even further. A flight to safety is under way in currency markets, with the yen and euro climbing against the dollar.

SEAN CALLOW, SENIOR FX ANALYST, ITC MARKETS, SYDNEY

It will be all hands on deck for Asian policymakers today, but they know that they have limited control over market panic. The only real circuit breaker is President Trump’s iPhone and he is showing little sign that the market selloff is bothering him enough to reconsider a policy stance he has believed in for decades.

DAVID SEIF, CHIEF ECONOMIST FOR DEVELOPED MARKETS, NOMURA, NEW YORK

In market selloffs like this, panic and forced selling via margin calls can dominate for a while. That’s not to say that it isn’t based on a very real negative event, which is these tariffs. But I think the ensuing selloff can take on a life of its own. Bottom line, I’m not sure when stocks will find a bottom, but I don’t think stocks are returning to their pre-April 2 levels any time soon.

ANINDA MITRA, HEAD OF ASIA MACRO STRATEGY, BNY INVESTMENT INSTITUTE, SINGAPORE

The market may be justifiably concerned but it appears to be pricing in the worst of an adverse trajectory of trade policy shifts in the US. In this context, any (eventual) negotiated and downward adjustments in bilateral tariffs or a bigger-than-expected US fiscal offset or a quicker-than-expected Fed policy pivot may counter some of the headwinds.

But until there is greater visibility in bilateral negotiations and tariff rollbacks, and other macro policy support, market volatility may stay elevated.

Continued from last post:

JASON WONG, SENIOR MARKET STRATEGIST, BNZ, WELLINGTON

Trump’s not blinking yet, and his entourage aren’t blinking over the weekend ... but there comes a point, when they do capitulate, and you’re trying to play the market. As to when that might happen – we need some sort of Trump team response before the bleeding is going to stop.

KAREN JORRITSMA, HEAD OF EQUITIES, AUSTRALIA, RBC CAPITAL, SYDNEY

Trump got us into this. But what can get us out of it? It’s not him, if there’s no clear line of sight here to the exit point for this, or the catalyst for this to be over – that’s my concern. I think he felt he had control, but he hasn’t – he’s lost control. It’s gone too far. The Chinese have got involved ...

ROBERT PAVLIK, SENIOR PORTFOLIO MANAGER, DAKOTA WEALTH, FAIRFIELD, CONNECTICUT

One of the problems is that people were looking for some kind of comment over the weekend from somebody in the administration that would indicate some possible negotiation or maybe a change in the tariffs. But they seemed to dig in their heels so we’re down more than 4%.

… People are real nervous about the uncertainty this brings, the potential decline in earnings, the fact the Federal Reserve has said they are going to wait and stay on hold until they get more clarity. If the Fed isn’t coming to the rescue, then who else is going to come to the rescue? People are afraid the worst is yet to come. They’re worried about a market crash. They’re worried about what follows, a recession here domestically and then globally, leading to a possible depression.

JOHN MILROY, PRIVATE WEALTH ADVISOR, ORD MINNETT, SYDNEY

All the conversations I have had with clients are more about when do we buy something rather than sell. This is leveraged selling that has no choice. I have fear for some of those private credit shops as prices and credit spreads swing wildly.

Key in the short term is if China pulls the pin on a big stimulus package directed at consumers. The broader market was already expensive, always had to be a reckoning. Here it is. Next comes the earnings changes.

ANGELO KOURKAFAS, SENIOR INVESTMENT STRATEGIST, EDWARD JONES, ST LOUIS

Fear is what continues to drive market action since the April 2nd tariff announcement. I think many investors are fearing the worst-case scenario of a prolonged trade war. Until we get an off-ramp and some indication that we potentially are pivoting to cutting deals to lower tariffs, that sentiment will remain fragile.

Continued next post

Among the governments already signalling a willingness to engage with the US to avoid Trump’s tariffs, Taiwan’s president has offered zero tariffs as the basis for negotiations.

On Sunday Lai Ching-te pledged to remove trade barriers and said Taiwanese companies would raise their US investments.

The Israeli prime minister, Benjamin Netanyahu, said he would seek a reprieve from a 17% tariff on the country’s goods during a planned meeting with Trump on Monday, Reuters reports.

An Indian government official said the country did not plan to retaliate against a 26% tariff and that talks were under way with the US over a possible deal.

In Italy, the prime minister, Giorgia Meloni – a Trump ally – pledged on Sunday to shield businesses that suffered damage from a planned 20% tariff on goods from the European Union.

Italian wine producers and US importers at a wine fair in Verona on Sunday said business had already slowed and feared more lasting damage.

India’s benchmark Nifty 50 is poised to open sharply lower on Monday.

The GIFT Nifty futures were trading at 22,089 as of 7:55 am IST, indicating that the blue-chip Nifty 50 will open about 3.6% lower than Friday’s close of 22,904.45, Reuters is reporting.

“We see the recent lows around 21,800 get re-tested on the Nifty 50 given this week’s price action,” said Abhishek Goenka, chief executive officer of India Forex and Asset Management.

We remain cautious in the near term given the tariff-related uncertainty.

Other Asian markets have slumped amid the worries of a global trade war and a US recession triggered by the Trump Administration’s tariffs regime.

India’s central bank is widely expected to cut rates by 25 basis points amid expectations that monetary policy may turn more supportive as the tariffs threaten to hurt the economy.

The Nifty 50 is trading about 13% lower than the record high levels hit in late September, as slowing earnings and growth triggered a $27-billion foreign exodus from domestic markets.

Meanwhile, India is likely to meet its projected growth target of 6.3-6.8% for the fiscal year 2025-26 if oil prices remain below $70 a barrel, despite the global disruptions due to US tariff announcements, a finance ministry official said.

South Korea’s finance minister has said the government will prepare support measures for sectors with urgent needs, ahead of Donald Trump’s 25% tariff coming into force this week.

Choi Sang-mok “emphasised the need to analyse the impact on the macroeconomy and prepare support measures for sectors with urgent needs”, the ministry said in a statement on Monday .

On 2 April, Trump introduced a blanket tariff on imports to the US and higher
tariffs against “worst offenders”, including a 25% duty on imports from South Korea, set to come into force on Wednesday.

Reuters also reports that South Korea’s exports to the US hit a record high of $127.8bn in 2024, with automobiles – the top-selling product – accounting for 27% of the total.

On Monday, Choi and other policymakers also reviewed a response strategy ahead of the trade minister, Cheong In-kyo, visiting the US, the finance ministry said.

Separately, South Korea’s financial regulator asked firms and state institutions on Monday to be prepared to provide liquidity support for exporting companies and their contractors hit by tariffs.

In Australia, more than $160bn has been wiped off the Australian share market this morning as fears of a full-blown trade war grip investors, reports Jonathan Barrett.

The benchmark S&P/ASX 200 sank more than 6% to trade below the 7200-point mark within 15 minutes after the market opened on Monday.

The Australian dollar, meanwhile, fell to its lowest level since Covid against the US dollar as global markets sell off against the prospects of a global recession.

One Australian dollar was buying just 60 US cents on Monday morning after falling to a low of 59.64, its lowest point since April 2020, reports Luca Ittimani. It was worth 64 US cents on Wednesday, hours before Donald Trump set markets reeling with his tariff announcement.

The Australian dollar also reached pandemic-era lows in Europe, with one dollar buying just 54.4 Euro cents or 46.2 British pence at its lowest point on Monday morning.

Donald Trump says foreign governments will have to pay “a lot of money” to lift the sweeping tariffs he has characterised as “medicine” and which have routed Asian share markets. Those are among the top lines are in our latest full report on the turmoil.

The Nikkei dropped as much as 8.8% to hit 30,792.74 for the first time since October 2023.

In South Korea, trading on the Kospi index was halted for five minutes at 9.12am as stocks plummeted.

The Taiwan stock exchange said early on Monday it would roll out more policies to stabilise markets if there were “irrational falls”.

See the full report here:

Taiwan stocks plummeted almost 10% on Monday in their first trading since Donald Trump announced his new tariffs regime last week, with the head of the island’s stock exchange saying it would roll out more stabilisation policies if needed.

After opening on Monday following a two-day market holiday on Thursday and Friday, Taiwan’s benchmark index dropped to its lowest level in more than a year, Reuters reports.

Taiwan’s top financial regulator on Sunday announced it would impose temporary curbs lasting all this week on short-selling of shares to help deal with potential market turmoil from the tariffs.

Shares in chipmaker TSMC and electronics maker Foxconn both fell near 10%, triggering the 10% circuit breaker in the Taiwan market.

Speaking to reporters shortly after the market opened, Taiwan stock exchange chairman Sherman Lin said it would coordinate with the financial regulator to take further stabilisation steps if needed.

The stock exchange would maintain flexibility in stabilisation measures this week to handle volatility stemming from new U.S. import tariffs, Lin added.

He said it would be hard for Taiwan to escape the market impact of the tariffs, but called on investors to have confidence in Taiwanese companies and the government.

US Treasury yields fell on Monday and the two-year yield sank to a multi-year low as worries of a possible recession in the world’s largest economy grew and investors wagered that could see US rates cut as early as May.

The two-year US Treasury yield, which typically reflects near-term rate expectations, tumbled more than 20 basis points to its lowest level since September 2022 at 3.4350%, as investors ramped up bets of more aggressive Federal Reserve easing this year, Reuters reports.

The benchmark 10-year yield last stood at 3.9158%, languishing near Friday’s six-month low of 3.8600%.

Futures now point to nearly 120 basis points’ worth of Fed cuts by December and markets swung to imply a roughly 60% chance the US central bank could ease rates in May, as policymakers seek to shore up growth in the world’s largest economy on the back of President Donald Trump’s latest tariff salvo.

JPMorgan ratcheted up its odds for a U.S. and global recession to 60%, as mentioned, and brokerages elsewhere similarly raised their probability of a US recession as tariff distress threatens to sap business confidence and slow global growth.

Almost $5tn was wiped off the value of global stock markets last week after Donald Trump launched his tariff offensive last Wednesday.

The US market was particularly hard hit. The benchmark S&P 500 lodged its biggest weekly drop since March 2020 and the Nasdaq Composite on Friday ended down more than 20% from its December record high, confirming the tech-heavy index is in a bear market.

The Dow Jones Industrial Average finished the week down well over 10% from its December record high, marking a correction for the blue-chip index.

Oil prices fell more than 3% on Monday – extending losses from the previous week – on growing concerns that a global trade war could slow the global economy and weaken oil demand.

Brent futures declined $2.1, or 3.2%, to $63.48 a barrel at 1027 GMT, while US West Texas Intermediate crude futures lost $2.14, or 3.5%, to $59.85, Reuters reports.

Both benchmarks plunged 7% on Friday to settle at their lowest in over three years as China ramped up tariffs on US goods in retaliation at Donald Trump’s tariffs, escalating a trade war that has led investors to price in a higher probability of recession.

Responding to Trump’s tariffs, China on Friday said it would impose additional levies of 34% on American goods, confirming investor fears that a full-blown global trade war is under way.

Investment bank JPMorgan said it now saw a 60% chance of a global economic recession by year-end, up from 40% previously.