The week was marked by a sharp escalation in trade tensions between the United States, China, and the European Union, which heavily impacted global markets. Volatility surged, with sharp fluctuations in equity indices, a drop in commodities, and a deterioration in economic expectations. Below is a complete summary of the movements and developments that shaped the international landscape.
Monday – Risk-off Sentiment at the Open
The week began under significant pressure in global markets. US stock futures dropped sharply, reflecting the intensifying tariff stance adopted by the United States. President Donald Trump reiterated that tariffs are his main tool against trade deficits, while China initiated retaliation and the European Union prepared its own response.
In the US, S&P 500 futures fell nearly 2%, Nasdaq 100 futures dropped over 2%, and the Dow Jones lost almost 700 points. Analysts raised recession forecasts: Goldman Sachs increased the probability of a 2025 contraction to 45%, citing tighter financial conditions and heightened political uncertainty.
Apple lost around $450 billion in market capitalisation since the beginning of the dispute. Wedbush lowered its price target to $250, warning of the direct impact on the company’s supply chain, which is largely based in China.
In Europe, the banking sector also saw steep declines. Institutions such as Commerzbank, Deutsche Bank, Santander and HSBC led the losses, following the downtrend that had started in Asia. Meanwhile, oil prices hit four-year lows due to fears of a drop in global demand and signals from OPEC+ suggesting potential increases in production.
Tuesday – Technical Relief and Promises of Confrontation
After two consecutive sessions of sharp losses, international stock markets attempted a rebound. US stock futures rose, with the Dow Jones gaining over 700 points in early trading, despite lingering uncertainty around trade policy.
Rumours of a possible tariff suspension by the White House circulated in markets but were quickly denied. Even so, the relief rally was supported by tech stocks and opportunistic buyers. The VIX volatility index remained at elevated levels, similar to those seen during the 2020 health crisis.
In Asia, China reaffirmed its willingness to respond forcefully and declared it was ready to “fight to the end.” In Europe, the European Commission released a new list of US products subject to retaliation while signalling openness to negotiations aiming for a “zero tariff” agreement.
A Washington Post report revealed that Elon Musk had attempted to personally intervene with Trump to mitigate the impact of tariffs on Tesla and the automotive supply chain.
In the oil market, contracts traded near flat after the previous sell-off. Bitcoin and other cryptocurrencies rallied, driven by a search for alternatives amid growing global uncertainty.
Wednesday – New Round of Tariffs and Market Impact
With the implementation of a new round of US tariffs, Wall Street futures dropped once again, with the Dow Jones falling over 600 points in early trading. The S&P 500 dropped below 5,000 for the first time in nearly a year, amassing billions in losses within days.
The increase in average tariffs on Chinese goods to 104% further intensified tensions between the two powers. Beijing responded firmly, stating it would not accept unilateral impositions. Uncertainty remains over the White House’s true intentions — whether it’s a temporary bargaining strategy or a structural shift in US foreign policy.
Meanwhile, the first Q2 earnings reports were released. Delta Air Lines reported weakening demand, while Constellation Brands posted mixed results reflecting shifts in consumer behaviour.
Markets were also focused on the release of minutes from the latest Federal Reserve meeting. Although interest rates were held steady in March, the document suggested rate cuts could be brought forward if inflation worsens as a result of tariffs.
Oil prices hit fresh lows, with Brent falling to $59 and WTI to $55, marking a 20% drop over five days. The slump reflects demand concerns compounded by declining consumer confidence data in the US.
Thursday – Partial Tariff Suspension and Market Reaction
Donald Trump surprised markets by announcing a 90-day suspension of most tariffs on allied nations, delaying the implementation of new measures. The move was interpreted as a response to the sharp stress observed in equity and fixed income markets, which had been under pressure from heavy sell-offs.
The day prior, the Dow Jones had jumped nearly 8%, in a relief rally comparable to that of October 2008. However, the respite was short-lived: on Thursday, futures resumed their decline, with the Nasdaq falling over 2%.
China was the exception to the suspension. Tariffs on Chinese goods were raised to 125%, following a fresh round of sanctions from Beijing. The risk of a prolonged deadlock between the world’s two largest economies kept markets on edge.
Additionally, US consumer inflation came in below expectations. Core CPI rose 0.1% in March versus a 0.2% forecast, offering temporary relief from inflationary pressures. Nonetheless, long-term projections remain above 4%, according to the University of Michigan.
Friday – Gold Rallies, Oil Slumps, and Focus Shifts to Earnings
Markets sought stability on Friday. US stock futures opened higher, with the Dow Jones gaining 0.6% after Thursday’s decline. Tensions between the US and China remained in focus after Trump stated that tariffs on Chinese imports had risen by 145% since the start of his second term.
Earnings season kicked off in the US, with major banks reporting results. Executives from J.P. Morgan and Morgan Stanley warned of the tariffs’ impact on credit, consumer spending, and defaults. “Resilience” was a recurring theme, though the overall tone remained cautious.
The University of Michigan’s consumer sentiment index showed falling expectations, with long-term inflation forecasts continuing to climb.
In the commodities market, gold hit a new all-time high, surpassing $3,200 per troy ounce as investors sought safety amid rising uncertainty. Oil, meanwhile, posted its second consecutive weekly loss, with Brent down 4% and WTI falling more than 3%.
Conclusion:
The week confirmed a rise in global instability, with direct impacts on equities, commodities and currencies. Market movements in the coming days are likely to remain heavily influenced by political decisions, economic responses and macroeconomic data. The environment remains volatile and will demand close attention to every new shift on the global board.
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