By Agboola Aluko, GLiDE NEWS | Lagos
April 4, 2025 — Global financial markets were thrown into chaos Thursday following President Donald Trump’s dramatic unveiling of sweeping new tariffs on nearly all foreign imports into the United States. The move, branded “Liberation Day” by the Trump administration, sent shockwaves through Wall Street and foreign markets alike, igniting widespread fears of a deep global recession and drawing comparisons to the economic isolationist policies that triggered the Great Depression.
In the hours following Trump’s announcement, the Dow Jones Industrial Average plunged 1,679 points, a 3.98% loss. The S&P 500 fell 4.84%, while the Nasdaq tumbled nearly 6%, marking the worst single-day performances for all three indices since the onset of the COVID-19 pandemic in 2020.
Across the Atlantic, markets didn’t fare much better. Germany’s DAX slid 3%, France’s CAC 40 plummeted 3.31%, and Italy’s FTSE MIB tumbled 3.6% — their worst performances in years. Asia also reacted sharply, with Japan’s Nikkei 225 losing 2.77% and Hong Kong’s Hang Seng shedding 1.52%.
“This is the policymaking equivalent of a suicide bomber,” said Michael Block, a market strategist at Third Seven Capital, warning of severe long-term economic damage.
A Self-Inflicted Wound?
At the core of the market panic is Trump’s aggressive push to slap 10% to 50% tariffs on all imports, a move his administration frames as a bold step to protect American industry and end decades of alleged trade abuse. But economists and investors are ringing alarm bells.
According to JPMorgan analysts, the tariffs represent a $660 billion annual tax hike on American consumers — the largest in modern U.S. history — likely fueling inflation and eroding purchasing power across the board.
“We view the full implementation of these policies as a substantial macroeconomic shock,” JPMorgan warned in a note, predicting that the U.S. and global economies are likely to enter a recession in 2025 if Trump’s tariffs remain in place.
Gold surged to an all-time high above $3,160 per ounce, as jittery investors fled to traditional safe-havens. Meanwhile, the U.S. dollar dropped to its lowest level since October, signaling fading global confidence in the U.S. economy.
The 10-year Treasury yield, a critical indicator of investor sentiment, dropped to 4.05%, its lowest since last autumn.
“Investors are reacting to the drag that uncertainty and trade barriers will have on growth,” said Chip Hughey of Truist Advisory Services.
Companies Count the Costs
Industries reliant on international supply chains were hit particularly hard. Apple (AAPL) nosedived 9.3%, wiping over $310 billion from its market value. Nike (NKE) sank 14.4%, Best Buy (BBY) lost 17.8%, and Ralph Lauren (RL) dropped 16.3%.
“Universal tariffs ranging from 10–50% run the risk of causing major harm to American manufacturers, workers, families, and exporters,” warned Joshua Bolten, CEO of the Business Roundtable.
The Cboe Volatility Index (VIX) — Wall Street’s “fear gauge” — surged nearly 40%, reflecting extreme anxiety in the market. CNN’s Fear and Greed Index fell to its lowest reading of the year.
Still, the White House appeared undeterred. Press Secretary Karoline Leavitt encouraged investors to “trust in President Trump,” claiming the administration is reviving the “proven economic formula” of his first term.
President Trump himself dismissed concerns, stating, “The markets are going to boom... and the country is going to boom.”
Echoes of the Great Depression?
Fitch Ratings projected that U.S. tariff rates will rise from 2.5% last year to a staggering 22%, exceeding the infamous Smoot-Hawley Tariff Act of 1930, which many economists believe worsened the Great Depression.
“You can throw most forecasts out the door,” said Olu Sonola, head of U.S. economic research at Fitch. “Many nations will likely plunge into recession if this tariff rate is sustained.”
Adding to the chaos, oil prices collapsed, with U.S. crude falling 6.6% to $66.95 per barrel and Brent crude tumbling 6.4% to $70.14 — the biggest drops in over two years. The plunge came amid fears of a global slowdown and an unexpected move by OPEC+, including Saudi Arabia and Russia, to accelerate oil production starting in May.
What Comes Next?
Economists warn that the real danger lies not just in the tariffs themselves, but in the global retaliation they could spark. Both the European Union and Britain have signaled plans to strike back, potentially igniting a full-scale trade war.
If that happens, prices on everything from electronics to clothing to food could spike, just as inflation had begun to cool. The Consumer Price Index (CPI) could see a 2% boost, JPMorgan estimates — reigniting the inflation crisis that the Federal Reserve spent years trying to tame.
With economic sentiment plunging and consumer spending likely to shrink, business investment could stall, worsening the slowdown.
“This is a game-changer, not only for the U.S. economy but for the global economy,” said Sonola.
As markets brace for further shocks, it’s clear that the full economic fallout of Trump’s tariff war is just beginning to unfold.
Agboola Aluko
Senior Correspondent, GLiDE NEWS — Lagos
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