The week was marked by intense volatility in global markets, with Wall Street facing significant declines and a technical correction in the S&P 500. The instability was mainly driven by the trade policies of the United States President, Donald Trump, and their impacts on the global economy. In addition, inflation and consumer confidence data brought mixed signals, increasing caution among traders.
Tariffs and Fall in Indices
On Monday, US futures indices registered losses amid concerns about the tariffs imposed by Trump on imports, mainly steel and aluminum. The decision generated uncertainty about the trajectory of inflation and economic growth, causing the S&P 500 to end its worst week in six months. The Nasdaq Composite, with a large exposure to the technology sector, entered correction territory, accumulating losses of more than 10% since its all-time high.
Markets attempted a modest recovery on Tuesday after a sharp decline. Fears of a recession grew, fueled by tariffs and the possibility of an economic slowdown. The Trump administration faced criticism from companies such as Delta Air Lines, which revised its profit forecast downward due to trade uncertainty. Oracle also reported results below expectations, but highlighted an optimistic outlook for its cloud computing division.
European Union Responds, Markets Remain Volatile
On Wednesday, the European Union announced it would impose tariffs on U.S. goods in retaliation for the measures imposed by Washington. The move raised concerns about an escalation in global trade tensions. In addition, Ukraine agreed to a temporary ceasefire with Russia after negotiations brokered by the United States, allowing the resumption of American security support to Kiev.
Despite the unstable scenario, futures indexes rose, driven by expectations around an important inflation indicator. However, volatility persisted due to changes in Trump’s tariff policy. After threatening to double tariffs on Canadian steel and aluminum imports, the president backed down after the province of Ontario removed a tax on electricity exported to the United States.
On Thursday, markets operated close to stability, reflecting caution in the face of the release of the producer price index and the deepening of the tariff dispute between the United States and Canada. Soft inflation data brought some relief, but were not enough to dispel uncertainty. Meanwhile, the US Senate was negotiating measures to avoid a federal government shutdown.
Correction in the S&P 500 and Traders’ Reaction
On Friday, markets sought a recovery after a sharp sell-off that saw the S&P 500 officially enter correction territory, accumulating losses of more than 10% from its recent peak. The Nasdaq 100 and Russell 2000 also saw significant adjustments, reflecting the pessimism generated by government statements about tariffs and possible impacts on the economy.
Among corporate highlights, Tesla warned about the negative effects of tariffs on electric vehicle manufacturers, highlighting the direct impact of political decisions on the industrial sector. In addition, a metric on consumer confidence for March was released, while Democrats in the Senate indicated support for a Republican bill that would prevent a government shutdown.
Outlook for the Next Few Days
With the escalation of trade tensions and market volatility, next week promises to continue to be hectic. Traders will continue to pay attention to new statements from the US government, relevant economic data and international movements that could influence the global scenario. The technical correction in the indexes reinforces the need for constant monitoring, as uncertainties remain high.
