Global stock markets nosedived Friday as tensions between the US and China spiralled, triggering fears of a prolonged trade war and economic downturn. The S&P 500 tumbled nearly 6%, capping its worst week since 2020, while the Dow and Nasdaq sank over 5%. In the UK, the FTSE 100 fell 4.9%—its sharpest drop in five years—mirrored by steep losses across Europe and Asia.
The rout followed China’s retaliatory tariffs of up to 34% on US goods, in response to President Trump’s sweeping new import taxes on global goods. Trump brushed off the market panic, urging Americans to “hang tough.”
Analysts warn the tariffs could lead to the biggest US tax hike since 1968, risking global recession. Companies heavily reliant on international supply chains, including Apple and Nike, led the selloff. JP Morgan now estimates a 60% chance of global recession, as investor confidence continues to erode.
