The S&P 500 slipped into bear market territory in early trading but by the end of the day climbed back close to where it opened. President Trump said he would not back off his trade war, reinforcing fears of a global economic downturn.The New York Times reports that on April 7, 2025 at 1:43 p.m. ET, President Trump issued a new ultimatum to China, threatening to impose additional tariffs of 50 percent unless Beijing rescinds its retaliatory tariffs on the United States by Wednesday. This announcement caused the S&P 500 to swing wildly, with the index briefly entering bear market territory. The President’s trade war has sparked fears of a global economic downturn, leading to a sell-off in Asian and European markets.
Despite growing concerns about the impact of his tariffs on the economy, President Trump defended his actions, stating that they have already brought in billions of dollars in revenue for the United States. He also declared that he would stop negotiations with China unless they withdraw their tariff plans. The S&P 500 opened lower before fluctuating throughout the day, while Asian and European markets continued to experience losses.
Many Asian countries, including Bangladesh and Vietnam, have requested a delay in the tariffs, while the Philippines has announced plans to reduce tariffs on goods from the United States. South Korea and Japan have also expressed a desire to meet with the Trump administration. In Hong Kong, the main stock index plunged 13 percent, while Taiwan’s stock market lost 10 percent of its value. European markets closed sharply lower, with the Stoxx Europe 600 down 4.5 percent and the FTSE 100 in London down 4.4 percent.
In addition to the stock market turmoil, oil prices have also been affected, with benchmark Brent crude oil prices down more than 2 percent on Monday. Meanwhile, President Trump has called for the Federal Reserve to cut interest rates, a move that could potentially fuel inflation. Despite concerns about the impact of his tariffs on prices, the President has dismissed these worries, calling them “a very beautiful thing.”
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