US Stock Market: ‘Time for US to stop…’, says China reacting to US market crash

US Stock Market: Wall Street’s worst crisis since COVID slammed into a higher gear Friday after China announced that it is set to impose 34 per cent additional tariffs on all imports from the United States in retaliation to US President Donald Trump's reciprocal tariff announcement.

China Reacts

On Saturday, China reacted to the bloodbath in the US stock market after its announcement of additional tariffs on all imports from the United States.

Chinese Foreign Ministry's spokesperson, Guo Jiakun, highlighted that it is time for the United States to stop doing the “wrong things” and work to resolve its differences with its trading partners.

“Now is the time for the U.S. to stop doing the wrong things and resolve the differences with trading partners through equal-footed consultation,” according to the social media post.

Trump's Hails Tariffs post stock market crash

US President Donald Trump hailed the US tariffs on nations after the stock market crash and said that more than $5 trillion and more has been invested in the cause as he eyes a trade war win for the United States.

“China has been hit much harder than the USA, not even close. They, and many other nations, have treated us unsustainably badly. We have been the dumb and helpless “whipping post,” but not any longer. We are bringing back jobs and businesses like never before. Already, more than FIVE TRILLION DOLLARS OF INVESTMENT, and rising fast! THIS IS AN ECONOMIC REVOLUTION, AND WE WILL WIN. HANG TOUGH, it won’t be easy, but the end result will be historic. We will, MAKE AMERICA GREAT AGAIN!!!” said the US President in his post.

Jaguar suspends US shipments

United Kingdom's luxury carmaker on Saturday said that they are going to “pause” their shipments to the United States in April 2025. This move comes as “the new trading terms” come into effect after US President Donald Trump announced the reciprocal tariffs on April 2.

“The USA is an important market for JLR's luxury brands. As we work to address the new trading terms with our business partners, we are enacting our short-term actions including a shipment pause in April, as we develop our mid- to longer-term plans,” said the Jaguar spokesperson, reported the news agency AFP on Saturday.

S&P 500 down 6% and Dow down 2,200

The S&P 500 lost 6% after China matched President Donald Trump’s big rise in tariffs announced earlier this week. The move increased the stakes in a trade war that could end with a recession that hurts everyone. Not even a better-than-expected report on the US job market, which is usually the economic highlight of each month, was enough to stop the slide.

The drop closed the worst week for the S&P 500 since March 2020, when the pandemic ripped through the global economy. The Dow Jones Industrial Average plunged 2,231 points or 5.5%, and the Nasdaq composite tumbled 5.8% to pull more than 20% below its record set in December.

The US Stock Market meltdown has wiped out over $5 trillion in Trump’s tariff war.

Currencies react

The Bloomberg Dollar Spot Index rose 1%, while the euro fell 1% to $1.0944, according to Bloomberg at 5:59 am on April 5. Meanwhile, the British pound fell 1.7% to $1.2876 and the Japanese yen dropped 0.6% to 146.95 per dollar.

What do experts say?

"Right now, how bad it gets depends on how committed the administration is to this set of policies which, clearly, the market is voting against," Steve Sosnick, chief strategist at Interactive Brokers, told Reuters.

"We're in the Wild West of a trade war right now," said Mariam Adams, managing director at UBS Wealth Management.

“US markets have now lost over USD 9 trillion in market cap since the January 20, Trump 2.0 Inauguration. US imports are USD 3.3 trillion. US tariff revenues, even if all imports stay and even if tariffs are collected on ALL these USD 3.3 trillion of imports, will be USD 600 billion,” Ajay Bagga, banking and market expert, told ANI.

“Imports will become costlier by around 20 per cent on average. Demand will go down, and import volumes will shrink. So, USD 600 billion will not be collected. But the market cap loss of USD 9 trillion is real,” Bagga added.

“It does feel like the sky is falling off. This is a very different scenario right now because we are at the whim of Washington; not Fed, not earnings, not jobs numbers," Jay Woods, chief global strategist at Freedom Capital Markets, told Bloomberg.

“We had significant shocks to financial markets,” Daniel Ivascyn, group chief investment officer, told Bloomberg.

Trump on FED rate cuts

US President Donald Trump urges the US Federal Reserve Chairman to cut the key benchmark interest rates. He cited the low inflation and the higher job rates as the “perfect time” to increase the rates in the Western nation.

“This would be a PERFECT time for Fed Chairman Jerome Powell to cut Interest Rates. He is always ‘late,’ but he could now change his image quickly. Energy prices are down, Interest Rates are down, Inflation is down, even Eggs are down 69%, and Jobs are UP, all within two months - A BIG WIN for America. CUT INTEREST RATES, JEROME, AND STOP PLAYING POLITICS!” said Trump in his post.

According to an AP report on Friday, the United States added 2,28,000 or 2.28 lakh jobs for the month of March 2025. However the unemployment rates in the Western nation rose to be at 4.2 per cent.

Zero Tariffs from Vietnam?

According to Donald Trump's social media post on Truth Social, To Lam, who is the General Secretary of the Communist Party of Vietnam, said that the South Asian nation to reduce their tariffs to “Zero” for the United States.

“Just had a very productive call with To Lam, General Secretary of the Communist Party of Vietnam, who told me that Vietnam wants to cut their Tariffs down to ZERO if they are able to make an agreement with the U.S. I thanked him on behalf of our Country, and said I look forward to a meeting in the near future,” said Trump in his post.

Great Time to invest?

US President Donald Trump, in a Truth Social post on Friday, assured investors that this is a “great time” to invest in the US economy to become richer than “ever before”.

“To the many investors coming into the United States and investing massive amounts of money, my policies will never change. This is a great time to get rich, richer than ever before!!!” said Trump in a social media post.

Who should not worry?

According to the US President, big business will not be impacted by the reciprocal tariffs.

“Big business is not worried about the Tariffs, because they know they are here to stay, but they are focused on the BIG, BEAUTIFUL DEAL, which will SUPERCHARGE our Economy. Very important. Going on right now!!!” Trump posted on his Truth Social handle on Friday.

Fears of global recession

Concerns of recession in the US economy arose following the reciprocal tariff announcement. JPMorgan Chase & Co. estimates a 60% chance of the global economy slipping into recession due to Trump's tariffs.

“We now expect real GDP to contract under the weight of the tariffs, and for the full year (4Q/4Q) we now look for real GDP growth of -0.3%, down from 1.3% previously,” according to a report by Bloomberg citing JPMorgan Chase & Co. chief US economist, Michael Feroli.

“The forecasted contraction in economic activity is expected to depress hiring and over time to lift the unemployment rate to 5.3%,” Feroli said.

According to Mark Zandi, Chief Economist at Moody's Analytics, “If the 25% tariff is fully implemented quickly and largely maintained, and U.S. trading partners retaliate approximately tit-for-tat, the U.S. and global economies will not suffer a depression, but they will suffer serious recessions.”

Zandi further added, “the recession will hit imminently and extend until next year. Real GDP will fall close to 2% peak to trough, and unemployment will increase from its current 4% to 7.5% at its peak next year. I attach a 15% probability to this dark scenario.”

US Markets on Friday

The US benchmark indices crashed on Friday. The Dow, Nasdaq and S&P 500, after hitting their lows, recovered a little before again hitting a fresh intraday low on April 4. The Dow Jones Industrial Average (DJIA) extended its intraday losses, currently down more than 4 per cent at 38,873 points at 12:58 p.m. (EDT).

The S&P 500 index was trading 4.75 per cent lower at $5,139.96 at 1:00 p.m. (EDT). On Friday, the Nasdaq fell 962.82 points, or 5.82%, to 15,587.79, confirming the tech-heavy index was in a bear market, according to Reuters.

At 9:30 a.m. (EDT), the Dow Jones Industrial Average (DJIA) opened 2.45 per cent lower at 39,551.47 points, compared to 40,545.93 points at the previous US market close.

Other US benchmark equity indices like the Nasdaq Composite dropped 2.86 per cent to 16,077.44 points at the Wall Street open on Friday, compared to 16,550.61 points at the previous trading close.

The S&P 500 index also opened 2.48 per cent lower at 5,262.47 points, compared to 5,396.52 points at Thursday's US market close.

Indian stock market on Friday

On Friday, Indian benchmark indices such as the Sensex closed at 75,364.69 points, down 930.67 points or 1.22 per cent, while the Nifty closed at 22,904.45 points, down 345.65 points or 1.49 per cent, respectively.

China Tariffs

On Friday, April 4, China announced that it is set to impose an additional 34 per cent tariff on all goods imported from the United States as a counter-move to the reciprocal tariffs announced by President Donald Trump on April 2.

“China Played It Wrong, They Panicked - The One Thing They Cannot Afford To Do!” said US President Donald Trump in his social media post on Truth Social after China's tariff announcement.

According to multiple agency reports, China is set to implement the 34 per cent tariff rate on all imports from the United States from April 10, 2025.

“The purpose of the Chinese government's implementation of export controls on relevant items in accordance with the law is to better safeguard national security and interests, and to fulfil international obligations such as non-proliferation,” Commerce Ministry of China said, reported the news agency Reuters.

China also disclosed that they will exercise more control on exporting medium and heavy rare earth minerals like samarium, gadolinium, terbium, dysprosium, lutetium, scandium and yttrium to the United States.

US Stocks

Companies with high exposure to China plunged, with Apple dropping 7.3%. Chipmaking giant Nvidia shares tanked 7.2 per cent to $94.46 at 10:36 a.m. (EDT) after the US markets opened on Friday, compared to $101.80 at the previous Wall Street close.

Nvidia stock has taken a hit as investors' concerns rise due to the exposure in its manufacturing operations in China. The shares of Nvidia Corp were trading more than 4 per cent lower in the pre-market session before the stock market opened for the Western nation.

Top losers

Companies like Boeing, Goldman Sachs Group, Nvidia Corp., JPMorgan & Chase, American Express Co., Caterpillar Inc., Chevron Corp., 3M Co., Apple Inc., Salesforce Inc., and Visa were among the top losers on the Dow Jones on Friday.

Top laggards on the Nasdaq Composite were Virpax Pharmaceuticals, NeuroOne Medical Technological Corp., Aptevo Therapeutics Inc., Hennessy Capital Investment Corp, Sonim Technologies Inc., Medirom Healthcare Technologies Inc., Lifecore Biomedical Inc., NewGenIvf Group Ltd., QuantaSing Group Ltd., and Atlas Lithium Corp were among others.

APA Corp., EQT Corp., GE Healthcare Technologies, Freeport-McMoRan Inc., were among other who lost on the S&P 500 index on Friday.

Jerome Powell raises alarm over inflation

Federal Reserve Chair Jerome Powell on Friday claimed Trump's tariff announcement will have an impact on the economy and inflation which will be “significantly larger than expected."

Powell said, “our obligation is to keep longer-term inflation expectations well anchored and to make certain that a one-time increase in the price level does not become an ongoing inflation problem,” he said. “We are well positioned to wait for greater clarity before considering any adjustments to our policy stance.”

Will Trump cut duties?

On Thursday, Donald Trump signalled that he would be willing to lower tariffs if other countries offered something “phenomenal," reported Bloomberg.

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