Stock Markets Carry On Falling Today As Sell Sell Sell Seems To Be The Order

7th April 2025

Today's stock market drop is being driven by significant global economic concerns, primarily sparked by the announcement of sweeping tariffs by former U.S. President Donald Trump. These tariffs, which impose a baseline rate of 10% on imports from all trading partners, have created fears of a global trade war. Some countries face even higher tariffs, leading to retaliatory measures and escalating tensions.

Major indices like the Dow Jones, S&P 500, and Nasdaq have seen their worst declines since 2020, with the Dow dropping over 1,700 points and the Nasdaq falling nearly 6%. The sell-off has been particularly harsh on technology stocks, as well as small-cap stocks, which have entered bear market territory2.

Globally, markets are also reacting negatively. The FTSE 100 in the UK and the Nikkei in Japan have both experienced sharp declines, reflecting widespread investor anxiety.

Many eyes will be on the US markets when they open later today.

The regions experiencing the most significant stock market declines today include:

Asia: The Hang Seng Index in Hong Kong has plunged nearly 13%, marking its worst day since 1997. Japan's Nikkei has also fallen by 7.8%, entering bear market territory.

Europe: Germany's DAX has dropped by 10.4%, and the FTSE 100 in the UK has fallen by 6.3%, hitting a one-year low.

United States: Futures for major indices like the Dow Jones, S&P 500, and Nasdaq indicate sharp declines when the market opens, with losses expected to exceed 4%.

The U.S. Dollar (USD) is currently experiencing mixed movements in the currency markets. While it remains strong against many major currencies like the Euro (EUR) and British Pound (GBP), reflecting its safe-haven status, there are signs of selling pressure in emerging market currencies. This is likely due to investors seeking to rebalance portfolios amidst the ongoing market volatility.

The ongoing market sell-off has hit several major companies hard, particularly in the technology, automotive, and retail sectors. Here are some notable examples:

Technology: Stocks like Nvidia, Tesla, and Apple have seen significant declines, with Tesla dropping over 6.9% and Nvidia down 5.1%.

Automotive: Companies like Ford and General Motors are facing pressure due to concerns over tariffs and supply chain disruptions.

Retail: Brands such as Nike and Crocs have been heavily impacted, with Crocs down 10.8% and Nike falling 7%.

Bank stocks are facing significant pressure today due to the broader market sell-off and concerns about rising interest rates and economic uncertainty. Here's a snapshot of the situation:

US Banks: Major banks like JPMorgan Chase, Bank of America, and Citigroup are seeing declines, with losses ranging from 3% to 5%. Investors are worried about the impact of higher interest rates on loan demand and credit quality.

UK Banks: Barclays, Lloyds, and NatWest have also been hit, with drops of around 4% to 6%. Concerns about the UK's economic outlook and rising public debt are weighing on these stocks.

European Banks: Deutsche Bank and Credit Suisse are experiencing sharp declines, reflecting broader concerns about the Eurozone's economic stability.

The current stock market declines are severe but not unprecedented. Here's how they compare to previous falls:

Magnitude: The Dow Jones dropped over 1,700 points recently, marking its fifth-worst point drop in history. However, in percentage terms, it's less severe than the 2008 financial crisis or the 1987 Black Monday crash.

Speed: The current sell-off has been swift, with major indices like the Nasdaq and S&P 500 entering correction territory (a 10% drop from recent highs) within weeks. This rapid decline is reminiscent of the COVID-19 market crash in 2020.

Causes: Unlike the systemic issues of 2008, today's declines are driven by external factors like tariffs and geopolitical tensions. This makes the situation different in nature, though the uncertainty it creates is comparable.

This posted at 8.57am on 7 April so expect huge changes as the day progresses. The Tariff war is just beginning.