Donald Trump has ruled out pausing the sweeping tariffs he has imposed on countries across the world after a rollercoaster day on Wall Street that ended with most of the US markets down.
Intense swings were seen on the three main stock market indexes on Monday as economists fear the US president’s “Liberation Day” levies could cause a global recession.
The S&P 500 closed the day 0.23% lower, while the Dow Jones Industrial Average finished down 0.91%, and the Nasdaq ended in positive territory, up 0.10%.
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All three indexes started the day sharply lower, and the Dow plunged as many as 1,700 points following even worse losses elsewhere in the world.
But it suddenly surged to a gain of nearly 900 points in the late morning. The S&P 500, meanwhile, went from a loss of 4.7% to a leap of 3.4%, which would have been its biggest jump in years.
The sudden rise appears to have been the result of a social media post that incorrectly claimed that Kevin Hassett, White House National Economic Council director, said Mr Trump was considering a 90-day pause in tariffs for all countries except China.
Reports first emerged through the US business news channel CNBC.
The White House later told CNBC any talk of a 90-day pause was “fake news”.
Financial pain hammers investments around the world
The financial pain once again hammered investments around the world, with stocks in Hong Kong plunging 13.2% for their worst day since 1997.
Meanwhile, the UK’s benchmark stock index, the FTSE 100, closed 4.38% down.
It is one of the biggest drops in years, in line with the falls seen in the early days of COVID-19 lockdowns, but less steep than the 4.95% loss seen on Friday.
Only a handful of the 100 most valuable companies listed on the London Stock Exchange saw any boost to their share price all day.
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Trump ‘not looking’ at pausing tariffs
When asked in the Oval Office on Monday evening whether he would pause tariffs, Mr Trump said: “We’re not looking at that.”
The president added that affected countries have been negotiating with his administration, which he said will try and make “fair deals” with each of them.
“We’re going to get fair deals with every country and if we don’t they are not going to be able to participate with the US,” he added.
Mr Trump also claimed the US “has been ripped off by many countries over the years”, adding: “We can’t do it anymore. We can’t be the stupid people anymore.”
Analysis: Tariffs could herald one of the most painful episodes in modern times
Trump threatens additional 50% tariff on China
It came after the US president threatened in a post on his Truth Social platform that he would impose an additional 50% tariff on China if the nation does not withdraw its 34% retaliatory tariff.
Beijing imposed the duty after Mr Trump announced his tariff on China last week.
The US president added in his Truth Social post that Beijing has until Tuesday to remove its retaliatory tariff.
Some investors are holding onto hope that Mr Trump may still lower his tariffs after negotiating with countries, and Mr Trump said on Sunday that he has heard from leaders “dying to make a deal”.
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‘Sometimes you have to take medicine to fix something’
A drop in tariffs relatively soon could help avoid a recession, but whether that can happen is still uncertain.
On Sunday, Mr Trump told reporters aboard Air Force One that he does not want markets to fall. But he also said he was not concerned about a sell-off, saying “sometimes you have to take medicine to fix something”.
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Mr Trump has given several reasons for his stiff tariffs, including to bring manufacturing jobs back to the United States, which is a process that could take years.
The US president has said he wanted to bring down the numbers for how much more the United States imports from other countries versus how much it sends to them.
“The recent tariffs will likely increase inflation and are causing many to consider a greater probability of a recession,” JP Morgan chief executive Jamie Dimon wrote in his annual letter to shareholders on Monday.
“Whether or not the menu of tariffs causes a recession remains in question, but it will slow down growth”, added Mr Dimon, who is one of the most influential executives on Wall Street.
