Tariff Fallout Shakes Global Markets: As April 2 approaches, all eyes are on the White House,
where U.S. President Donald Trump prepares to unveil a new package of reciprocal tariffs
targeting the United States’ trading partners.
While Trump describes the day as a “Liberation Day,” global markets see it as a
direct threat that signals another wave of volatility and financial disruption.

Contents

Rising Concerns
Policy Uncertainty
Fed Expectations
Sectors in the Crosshairs
Rising Pressure in Europe
Asia
A Tense Economic Environment

Rising Concerns and a Decline in Global Stocks

Global stocks have declined for the fourth consecutive day,
driven by investors’ concerns over escalating trade tensions.
Japan’s Nikkei 225 index dropped to its lowest level in over six months,
and South Korean and Australian markets also opened lower.
U.S. and European stock futures similarly showed weakness.

In contrast, gold surged to new record levels due to growing demand for safe-haven assets,
while U.S. Treasury yields fell as investors shifted toward hedging instruments.

The fallout from tariffs is expanding across multiple sectors,
heightening the sense of anxiety in global markets.

Policy Uncertainty and Global Economic Pressure

Although Trump stated that the new tariffs would be “lenient,”
The lack of specific details has left markets in cautious anticipation.
Last week’s announcement of auto tariffs caused major turmoil across the global automotive sector.

According to Bloomberg Economics, the expected impact on U.S. GDP and price levels depends on the scope and magnitude of the tariffs,
mainly if they cover major imports.
A Goldman Sachs index tracking stocks that perform
well during stagflation periods (low growth and high inflation)
has risen significantly, reflecting increased investor concerns.

Katrina Ell from Moody’s Analytics noted that aggressive trade policies paint an “alarming economic picture.”
At the same time, Mark Malek of Siebert warned that inflation is rising,
consumer spending is declining, and confidence is weakening—all due to current tariff strategies.

Fed Expectations and Potential Retaliation

Goldman Sachs expects the Federal Reserve to cut interest rates three times this year
to address the effects of a slowing economy and rising unemployment.

Solita Marcelli from UBS also warned that retaliatory measures from
America’s trading partners could significantly amplify market volatility.

Automotive, Pharmaceutical, and Tech Sectors in the Crosshairs

Last week, the Trump administration imposed 25% tariffs on vehicles not manufactured within the United States,
threatening higher costs for companies like General Motors and Ford Motor,
even though Ford makes most of its sales domestically.
Markets are now watching for the potential expansion of tariffs into other key sectors.
Companies such as Nvidia, AMD, and Intel could impact the semiconductor industry.
The pharmaceutical sector also faces risks, with major players like Pfizer, Johnson & Johnson,
Merck and Bristol Myers Squibb are potentially affected.
Additionally, industrial and consumer goods companies like Caterpillar, Boeing, Walmart,
and Deere are on the radar.
In the lumber industry, firms like Weyerhaeuser may see tariff increases on Canadian lumber,
possibly rising to 27%.
Meanwhile, the mining sector is under pressure as speculation grows about potential tariffs on copper imports,
which could impact companies like Freeport-McMoRan and Southern Copper.

Rising Pressure in Europe

Investors feel the weight of trade tensions in Europe, particularly in the automotive sector.
The Stoxx Europe index for automotive stocks and parts has declined by nearly 12% this year.

Among the most affected are Porsche, Mercedes-Benz, and Ferrari,
which have announced plans to raise the prices of specific models to offset the tariff impact.
Davide Campari-Milano, the producer of Aperol,
anticipates potential losses of €50 million if a 25% tariff is imposed on alcoholic beverages.

Metals companies like Rio Tinto, the largest aluminum supplier to the U.S., are also under increasing pressure.
Meanwhile, Novo Nordisk, maker of Ozempic and WeGovy, faces direct threats if pharmaceutical products are included in the tariffs.

Asia: Between Caution and Confrontation

Despite maintaining a massive trade surplus with the United States,
China is now less exposed to tariffs than during Trump’s first term,
as its share of U.S. imports has declined recently.
However, some companies in Hong Kong remain under pressure—Techtronic Industries,
which relies heavily on the U.S. market, has seen its stock drop by 8%.
In Japan, automakers Toyota and Honda are among the most vulnerable,
as vehicles and auto parts are the country’s top exports to the U.S. Within the semiconductor sector,
Attention is focused on major players like TSMC in Taiwan,
which derives 70% of its revenue from the U.S. and plans to invest over $100 billion,
along with Samsung Electronics in South Korea.
Hyundai and Kia are also at risk, particularly if the proposed 25% auto tariff moves forward.
Thailand is one of the most exposed economies in Southeast Asia
due to its significant dependence on agriculture and transportation exports.

A Tense Economic Environment and Key Developments Ahead

These developments come as the Thai stock market prepares to resume activity after a Myanmar earthquake,
and South Korea experiences volatility following the lifting of the short-selling ban.

Meanwhile, the Reserve Bank of Australia is expected to keep interest rates unchanged amid local elections,
and markets anticipate U.S. jobs data and key economic figures from Europe.

According to a note from Barclays led by Themistoklis Fiotakis,
The results of job openings data and the employment survey due this week
will be critical in assessing the actual economic damage from growing tariff uncertainty.

This ongoing tariff fallout shakes investor confidence across global markets,
as economic indicators continue to reflect rising volatility.

Tariff Fallout Shakes Global Markets

Tariff Fallout Shakes Global Markets

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