Equities
Global stocks extended losses after China imposed fresh tariffs of 34 per cent on all U.S. goods in response to U.S. President Donald Trump’s sweeping tariff plans, escalating a global trade war.
U.S. stocks opened sharply lower, with the Nasdaq Composite heading into a bear market. The Dow Jones Industrial Average fell 2.45 per cent to 39,551.47, the S&P 500 lost 2.48 per cent to 5,262.47 points, and the Nasdaq Composite slid 2.86 per cent to 16,077.44 at the bell.
The Toronto Stock Exchange’s S&P/TSX composite index opened 2 per cent lower at 23,850.06 points, led by losses in energy and mining stocks.
“If the current slate of tariffs holds, a Q2 or Q3 recession is very possible, as is a bear market,” said David Bahnsen, chief investment officer at The Bahnsen Group.
“The question is, does President Trump seek some sort of off-ramp for these policies if and when we see a bear market.”
This is going to hurt: World market themes for the week ahead
Overseas, the pan-European STOXX 600 was down 4.08 per cent in morning trading. Britain’s FTSE 100 fell 3.12 per cent, Germany’s DAX declined 4.02 per cent and France’s CAC 40 gave back 3.68 per cent.
In Asia, Japan’s Nikkei closed 2.75 per cent lower, while Hong Kong’s Hang Seng slid 1.52 per cent.
Commodities
Oil prices plunged by 8 per cent, heading toward their lowest close since the midst of the coronavirus pandemic in 2021, as China hit back in an escalating global trade war with the U.S. after President Donald Trump’s barrage of levies this week.
Brent futures plummeted 7.6 per cent to US$64.84 a barrel. West Texas Intermediate (WTI) crude futures dived 8.2 per cent to US$61.42.
“China’s aggressive countermove to U.S. tariffs all but confirms we are heading towards a global trade war; a war that has no winners and which will hurt economic growth and demand for key commodities such as crude oil and refined products,” said Ole Hansen, head of commodity strategy at Saxo Bank.
In other commodities, spot gold firmed 0.5 per cent at US$3,128.76 an ounce. U.S. gold futures rose 0.9 per cent to US$3,151.20.
Currencies and bonds
The Canadian dollar weakened against its U.S. counterpart.
The day range on the loonie was 70.38 US cents to 71.16 US cents in early trading. The Canadian dollar was up about 1.38 per cent against the greenback over the past month.
The U.S. dollar index, which weighs the greenback against a group of currencies, rose 0.21 per cent to 102.28 after a 1.9-per-cent drop yesterday, the biggest fall since November 2022.
The euro declined 0.22 per cent to US$1.1031. The British pound fell 0.69 per cent to US$1.3011.
In bonds, the yield on the U.S. 10-year note was last down at 3.946 per cent.
Economic news
China markets closed
U.K. GDP, retail sales and trade balance
Germany factory orders and manufacturing production
(8:30 a.m. ET) Canadian employment report for March. The country’s employment number dropped by a net of 32,600 people, the first decrease in more than two years, compared with a forecasted gain of 15,600 jobs.
(8:30 a.m. ET) U.S. employment report for March. The U.S. economy added far more jobs than expected, but trade turbulence could test the labour market’s resiliency. Nonfarm payrolls increased by 228,000 jobs last month, compared with a projected gain of 135,000 jobs.
(10 a.m. ET) U.S. Global Supply Chain Pressure Index for March.
With Reuters and The Canadian Press