Markets in Shock: Trump Tariffs Unleash 2025’s First True Meltdown

user
DoTrading
04-04

Here's a concise Market Intelligence Brief synthesizing the core themes from today’s events and

Thursday, April 3, 2025 - Market Recap & Macro Pulse

🔻 Equities: Deepest Selloff Since 2020

  • $S&P 500(.SPX)$ : -4.8%

  • $NASDAQ(.IXIC)$ : -6.0%

  • Dow: -4.0% (-1,679 pts)

  • Market cap wiped: ~$3.1 trillion

  • VIX: Elevated, stuck in “no-man’s-land” (uncertainty, but not peak fear)

The tariff barrage has upended market assumptions, pricing in a materially higher recession probability. Analysts and traders, caught flat-footed by the scale of the action, scrambled to reprice risk across all sectors.

Fair value on the S&P 500 is estimated near 4,900—but that’s assuming no further shocks. With market structure fragile, near-term downside risk remains elevated.

Data Highlights

  • Initial Jobless Claims: 219,000 (vs. ~219,900 average since 2022)

    Implies no labor market deterioration—yet.

  • Gasoline Demand:

    -8.0% WoW, -1.9% over 4 weeks

    Raises red flags about consumer strength.

Disruption Watch: Google Search Trends Signal Stress

  • Searches spiking: “Inflation,” “Interest Rate,” “Bankruptcy”

  • Searches falling: “Restaurant”

  • “Stock market” searches: Surpassing 2008 crisis levels These behavioral signals suggest deteriorating consumer sentiment—just as price shocks arrive.

Trade War Escalation: The Big Picture

SPX Perf

Trump’s "reciprocal" tariffs are anything but reciprocal in the classical sense. Instead, they represent massive new trade levies:

Country Tariff Rate China 54% (34% + prior 20%) Vietnam 46% Taiwan 32% Japan 26% EU 20% All others ≥10% (baseline) Steel, aluminum, autos, semis, pharma, lumber.

Trump: “April 2 will be remembered as the day America was reborn.” 💬 Market: “Worst-case scenario... and then some.” – Morgan Stanley

Morgan Stanley now estimates effective U.S. tariff rates near 22%, up from ~8% pre-announcement—a tax shock not seen since WWII.

Sector Carnage

Intel bucked the trend on JV hopes with $Taiwan Semiconductor Manufacturing(TSM)$ —closing up 2% despite early losses.

Street Sentiment Snapshot

  • Goldman Sachs: “Much worse than expected.”

  • JPMorgan: Recession risk rises to 60%.

  • Strategists: Markets will now “signal displeasure more loudly” to force change.

  • Most bullish case: These tariffs don’t stick if economic damage materializes.

What to Watch Next

  • Canada’s Countermeasures (April 4)

  • Tariffs take effect (April 5)

  • US Jobs Report (April 5)

  • Fed response chatter—rate cut expectations rising

  • Consumer behavior (retail sales, mobility, energy)

Bottom Line: Trump’s aggressive global tariff salvo has detonated across global markets. The economic feedback loop has just begun, and policy uncertainty is the new volatility driver. Recession probability is surging, and the Fed may be forced into earlier action—even as inflation risks remain alive.

If you find this post interesting, give it wings! ️ Repost and share the insights. Do consider “Follow me” and get firsthand read of my daily new post. Thank you. 

@TigerStars @Tiger_SG @TigerCommunity @Tiger_comments @Daily_Discussion @TigerEvents

This summary is for informational purposes only and does not constitute financial advice. Investors should conduct their own research before making investment decisions.
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

  • Venus Reade
    04-04
    Venus Reade
    I never seen stocks drop so fast before this dropped hard then covid time, with no plan of stopping
  • Valerie Archibald
    04-06
    Valerie Archibald
    Trump and his associates have more assets than average Americans. Why would they want to crash the market? Just curious.
Leave a comment
3
38