Stocks fell on Thursday as investors shifted to safe-haven assets like gold and bonds amid mounting fears over a recession following the announcement of the new U.S. tariffs.
Nasdaq futures dropped 3.56 percent, the Nikkei index lost 2.77 percent, and European futures, EuroSTOXX50 and DAX futures, both fell over 1.6 percent.
The dollar also dipped to a six-month low while U.S. 10-year Treasury yields declined after U.S. President Donald Trump announced on Wednesday a 10 percent baseline tax on imports from all countries and higher tariff rates on several other nations that run trade surpluses with the United States.
Tech stocks decline
Apple’s market capitalization fell by more than $240 billion as its shares slid 7 percent in after-hours trade. As of 8:08 GMT, Apple is trading 0.31 percent higher. Nividia shares also dipped to $108.97 before recovering to $110.42. Meanwhile, Microsoft fell 0.013 percent to $382.14.
Among the most prominent countries hit by the tariffs are China at 34 percent, the European Union at 20 percent, Vietnam at 46 percent, Taiwan at 32 percent, India at 26 percent and Japan at 24 percent. Canada and Mexico, the two largest U.S. trading partners, already face 25 percent tariffs on many goods and will not face additional levies from Wednesday’s announcement.
Trump’s sweeping tariffs will go into effect on April 5, and his reciprocal tariffs will hit on April 9 on new imports of foreign-made goods. “It’s our declaration of independence,” Trump said at an event at the White House.
Asian shares plummet
Mitsubishi UFJ Financial Group’s shares plunged 7.2 percent as the potential impact of the 24 percent tariffs on the export-dependent Japanese economy cut expectations that the central bank will keep raising interest rates. Meanwhile, Mizuho Financial Group fell 8 percent.
Sony Corp.’s stocks sank 4.82 percent while Toyota Motor Corp. dipped 5.2 percent.
In South Korea, which was hit with a 25 percent tariff, the benchmark Kospi fell 0.76 percent to 2,486.70. Meanwhile, Hong Kong’s Hang Seng lost 1.52 percent to 22,849.81 and the Shanghai Composite index edged down 0.24 percent to 3,342.01.
Read| Trump tariffs list: Over 180 countries and territories hit with “Liberation Day” tariffs
Gold hits new high as oil falls
Oil dropped more than 2 percent, with Brent futures reaching $73.28 a barrel. Australian shares and the Australian dollar also fell. Meanwhile, gold hit a record high above $3,160 an ounce, and Japan’s yen jumped more than 1 percent to 147.29 per dollar as foreign exchange traders looked for safety outside the U.S. dollar.
