Wall Street closes lower again two days after the tariffs announced by Trump

The financial market closed with sharp declines this Friday, after China's regime announced it would strongly retaliate against the United States in response to tariffs imposed by U.S. president Donald Trump, on what he dubbed as "liberation day." Thus, the S&P 500 plunged 5.97 %, while the Nasdaq Composite fell 5.82 % and the Dow Jones lost 5.5 %. Different analysts have explained that the fall of these stock indexes represents the markets' fear of the possibility of a global trade war, following Trump's announcement of tariffs on imported products to the world's main economies.

The numbers presented by the Nasdaq at market close were surprising, as it closed in what is called a bear market, or bear market, for the first time since 2022, materializing a drop of more than 20% from its all-time high reached in December 2024. For his part, senior index analyst at S&P Dow Jones Indices, Howard Silverblatt, explained that the way the S&P 500 closed this Friday confirms the serious problems it has been experiencing in the last two days, in which it has lost just over $5 billion dollars in market value, representing a drop of 10 % in this period.

Similarly, the Dow Jones closed in correction after registering a fall of more than 10 % from its record high reached last December. According to CFRA Research chief investment strategist Sam Stovall, this is the first time the index has closed in a correction in three years.

Recession risks

Numerous investors in the United States have expressed fears that the tariff hit executed by Trump could lead to a full-scale trade war that would eventually push the economy of both the country and other major economies around the world into recession. This Thursday, several JPMorgan analysts explained that the global economy and the U.S. economy had a 60% chance of falling into recession later this year.

Those analysts also asserted that the chances of recession would increase dramatically if other economic powers began toretaliate stronglyagainst the country, as China did.