Wall Street tumbles at the open after China retaliates
The New York stock market has opened, and stocks are sliding again.
Following the worst day since March 2020, shares are being hammered again after China retaliated against the US by announcing 34% tariffs on US goods earlier today.
The S&P 500 index, a broad measure of the US stock market, fell by 2.48% at the start of trading, down 133 points to 5,262.68.
The Dow Jones industrial average, which tracks 30 large US companies, has fallen by 982 points at the open, down 2.4%, to 39,563 points.
These losses mean the Dow is down 10% from its recent record high, putting it in ‘correction territory’.
Key events
The Russell 2000 index of small US company stocks has slumped 4.2% in early trading, to its lowest since December 2023.
Here’s our news story on China’s retaliation:
Trump: China played it wrong
Shortly before Wall Street opened, Donald Trump claimed that China had ‘panicked’ by announcing new retaliatory tariffs on US imports.
The president posted on Truth Social:
CHINA PLAYED IT WRONG, THEY PANICKED – THE ONE THING THEY CANNOT AFFORD TO DO!
Twenty eight of the 30 stocks on the Dow Jones industrial average are down in early trading.
The top fallers are companies who would suffer badly from an economic slowdown triggered by the US trade war.
Caterpillar, the maker of construction equipment such as diggers and bulldozers, are the top faller on the Dow, shedding 6.7% of value.
They’re followed by aeroplane maker Boeing (-5.9%), Goldman Sachs (-5.6%) and JP Morgan (-5.5%).
Nasdaq in bear market territory
Tech stocks are sliding again, pulling the Nasdaq index down by 3% in early trading.
The Nasdaq is now down more than 20% from the record high set last December, meaning it is in ‘bear market’ territory.
Wall Street tumbles at the open after China retaliates
The New York stock market has opened, and stocks are sliding again.
Following the worst day since March 2020, shares are being hammered again after China retaliated against the US by announcing 34% tariffs on US goods earlier today.
The S&P 500 index, a broad measure of the US stock market, fell by 2.48% at the start of trading, down 133 points to 5,262.68.
The Dow Jones industrial average, which tracks 30 large US companies, has fallen by 982 points at the open, down 2.4%, to 39,563 points.
These losses mean the Dow is down 10% from its recent record high, putting it in ‘correction territory’.
Trump: my policies will never change
Donald Trump has declared that his policies will ‘never change’, a few hours after China retaliated with tariffs on US goods.
The US president posted on Truth Social:
TO THE MANY INVESTORS COMING INTO THE UNITED STATES AND INVESTING MASSIVE AMOUNTS OF MONEY, MY POLICIES WILL NEVER CHANGE. THIS IS A GREAT TIME TO GET RICH, RICHER THAN EVER BEFORE!!!
However, Wall Street futures continue to indicate shares will tumble in 30 minute when trading resumes, with S&P 500 futures down 2.7%….
Donald Trump has just posted a video on his Truth Social network that argues the US president is deliberately crashing the stock market to bring down interest rates.
The short video, which you can see here on X, is made by a MAGA supporter who claims that “Trump is playing chess while everyone else is playing checkers”.
It argues that Trump’s goal is to push cash into Treasuries (US government debt), to encourage the Federal Reserve to cut interest rates and allow debt to be financed at a lower rate.
[Indeed, Treasury secretary Scott Bessent has indicated in the past the White House wants to keep bond yields low]
The video also claims that Warren Buffett has endorsed Trump’s moves – but I can’t find any evidence that this is true. Indeed, the legendary investor is a critic of tariffs, calling them an “act of war“ last month, pointing out:
“Over time, they are a tax on goods. I mean, the tooth fairy doesn’t pay ’em!”
Full story: US added 228,000 jobs in March
Michael Sainato
The US added 228,000 jobs in March, far more than expected, as the US economy shook off the blow from the Trump administration’s deep cuts to federal workers.
The figure was up from an adjusted 117,000 jobs added in February. Unemployment rose slightly to 4.2%.
Economists anticipated 140,000 jobs would be added in March 2025, a slight decrease from February and a continued decline from the monthly average of 167,000 jobs over the past 12 months. Payroll firm ADP reported 155,000 jobs were added in the private sector for March 2025.
Just in: the US economy added more jobs than expected last month.
Total nonfarm payroll employment rose by 228,000 in March, well ahead of forecasts for 135,000 new jobs last month.
🚨BREAKING: US March #NFP higher than expected!
📈Nonfarm Payrolls 228K (est. 137K, prev. 117K)
📈Private Nonfarm Payrolls 209K (est. 127K, prev. 116K)
📈Unemployment rate 4.2% (est. 4.1%, prev. 4.1%)
📉Average hourly earnings YoY 3.8% (est. 3.9%, prev.4.0 %)
📈Labor force… pic.twitter.com/6RF4WhDntm— MacroMicro (@MacroMicroMe) April 4, 2025
The U.S. Bureau of Labor Statistics reports that there were job gains in health care, in social assistance, and in transportation and warehousing.
But federal government employment declined by 4,000 in March, following a loss of 11,000 jobs in February. (this does not count people on severance pay, though, so may not capture the impact of cuts driven by Elon Musk’s DOGE department).
World shares fall into correction territory
The sight of China striking back against the US in Donald Trump’s trade war has driven global stock markets into ‘correction territory’ today.
MSCI’s All Country World Index, which covers companies across the global economy, is down over 1% today, after Beijing announced 34% tariffs on US goods.
That means it is over 10% below its record high, Reuters reports, a fall generally classed as a ‘correction’.
There are some dramatic moves in the currency markets today.
The Australian dollar has dropped by 3.5% today against the US dollar, while the Mexican peso is down 2.5%.
Risk appetite has taken “another big hit” as China struck back with fresh tariffs of its own against the US today, reports Fawad Razaqzada, market analyst at City Index and FOREX.com.
Razaqzada explains:
The world’s second largest economy has just announced a sweeping 34% tariff on all US goods, effective 10 April, escalating trade tensions yet again. In response, stocks, crude oil, and Aussie dollar all plunged, while government bonds and haven currencies – Japanese yen and Swiss franc – soared, alongside a rebounding gold.
With all these market tumbling, one has to wonder where it will all end.
So far, risk appetite has been literally non-existent. But there is still lingering hope that there might be some deals that could be agreed on before the April 9 go-live date for US reciprocal tariffs. However, as we get closer to that date, it looks like the trade war is only intensifying with China – and soon to follow others – coming back with counter measures.
Downing Street has said Sir Keir Starmer will be engaging with international leaders over the weekend, following the eruption of the global trade war that Donald Trump began this week.
A Number 10 spokesman said.
“We’ll be engaging with international leaders over the weekend.
“The need for engagement with international leaders is clear. It is a changing, shifting global economic landscape.”
European markets heading for worst weekly loss since Covid-19 panic of March 2020
The wave of selling gripping European markets has wiped 5% off the value of the Stoxx 600 index (of Europe’s largest 600 companies) today.
That takes its weekly losses to over 7.6%, which would be the worst week since March 2020, when the Covid-19 pandemic triggered a market crash.
EUROPE’S STOXX 600 NOW DOWN 7.66% ON WEEK, SET FOR BIGGEST WEEKLY FALL SINCE MARCH 2020
— First Squawk (@FirstSquawk) April 4, 2025
Nearly every share on the FTSE 100 index is down today.
The only risers are United Utilities and National Grid, classic defensive stocks (on the ground that people will still want water and electricity in an economic downturn), consumer goods maker Unilever, and tobacco firm Imperial Brands.
The FTSE 100 remains deep, deep in the red, down 329 points or 3.9% at 8146 points, a three-month low.
“Another jolt of fear shoots through markets”
The markets are “rattled” today after China’s retaliation against the US escalated the tariff war, reports Susannah Streeter, head of money and markets at Hargreaves Lansdown:
“Another jolt of fear has shot through markets, as China’s threat of retaliation has materialised. The big concern as that this a sign of a sharp escalation of the tariff war, which will have major implications for the global economy. The stock shock has shown up in even sharper losses with European indices sinking deeper into the red. Brent crude has also dropped sharply as expectations of a big hit to global growth and energy demand ratchets up.
The UK may appear to have been dealt a better hand in this round of tariffs, but it’s so interlinked with global trade, it’s set to be slammed by the harsh winds blowing through the global economy.
These kinds of market moves can feel incredibly uncomfortable, but anyone who has lived through any market turmoil in the past knows how important it is to focus on your long-term investment horizons and ride out short-term storms.
The pound has weakened against the US dollar today, as panicky traders seek out safe-haven currencies such as the Japanese yen and the Swiss franc.
Sterling has lost almost a cent against the dollar to just over $1.30.
