Wall Street reels from historic slump after Trump’s fresh trade threats
Wall Street ended a chaotic session after its worst three-day slump, while Australia’s ASX saw a $100bn wipeout as Trump threatened new trade blows against China.
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Wall Street has ended a volatile day of trading that saw some indices suffer their worst three-day declines in history before making late afternoon gains.
Donald Trump remained defiant in the face of the whipsawing market, threatening to escalate his trade war with China and unleashing further attacks on Australia’s beef trade.
It came after Australia’s market suffered its worst day in five years on Monday in a $100bn ASX wipeout.
The US markets fluctuated wildly across Monday’s trade, plummeting on the opening bell before rallying briefly after reports circulated Mr Trump was considering a tariffs pause.
But the selloff rapidly resumed after White House officials rubbished the claims, describing the reports as “fake news”.
After a rollercoaster session, the Dow closed about 1 per cent down from its opening on Monday, the S&P 500 was down 0.23 per cent and the Nasdaq closed slightly higher.
In a dramatic day of trade, the S&P entered bear market territory for the first time since 2022 and the tech-heavy NASDAQ Composite suffered its largest three-day decline since the dot-com crash of 2000 before rebounding.
The flat result was better than experts had hoped, with fears Wall Street was headed for a crash akin to the 1987 Black Monday wipeout.
Meanwhile, Mr Trump has doubled down on his criticism of Australia’s beef trade while defending his controversial global tariffs which saw Wall Street stocks continue to plummet on the opening bell.
As major US indexes crept toward bear market territory, the President took to social media to share commentary favourable of his economic vision.
It included a video of Republican Senator John Barrasso on Fox News who criticised Australia’s beef trade.
“Australia sold $29 billion worth of beef in the United States, and we haven’t been able to sell one hamburger in Australia because of barriers,” Mr Barrasso said.
“They showed Thailand, 30 per cent tariffs on beef coming from the United States, Vietnam, 50 per cent, you look at these numbers, and the ranchers of Wyoming are saying, thank you, Mr President, it is about time.”
“I appreciate what the President is doing on tariffs.”
RELATED: Why American beef can’t beat Australian beef
The President dug in against widespread backlash, urging Americans to be “strong, courageous and patient” with his vision.
The country is 100% behind the president on fixing a global system of tariffs that has disadvantaged the country. But, business is a confidence game and confidence depends on trust.
— Bill Ackman (@BillAckman) April 6, 2025
President @realDonaldTrump has elevated the tariff issue to the most important geopolitical…
It came as hedge fund giant Bill Ackman asked the president to hit the pause button on his sweeping global tariffs to allow room for negotiation instead of creating conditions for a recession.
Mr Ackman, who boasts a net worth of A$15 billion, was a vocal supporter of Mr Trump during his campaign.
In a series of lengthy posts on X, Mr Ackman took great pains to explain why a recession would in fact benefit him personally as his company would swoop in and buy highly discounted businesses.
However, for the good of the nation, he felt compelled to speak out urging Mr Trump to consider a 90 day pause on the tariffs and “fire” whoever was advising him to “strike deals while our market is collapsing.”
“Alternatively, we are headed for a self-induced, economic nuclear winter and we should start hunkering down,” Mr Ackman wrote.
“May cooler heads prevail.”
Mr Ackman said while he supported the concept of “fixing a global system of tariffs that has disadvantaged the country” the execution had gone off the rails.
“By placing massive and disproportionate tariffs on our friends and our enemies alike and thereby launching a global economic war against the whole world at once, we are in the process of destroying confidence in our country as a trading partner, as a place to do business, and as a market to invest capital,” Mr Ackman wrote.
“Business investment will grind to a halt, consumers will close their wallets and pocket books, and we will severely damage our reputation with the rest of the world that will take years and potentially decades to rehabilitate.
“What CEO and what board of directors will be comfortable making large,
long-term, economic commitments in our country in the middle of an economic nuclear war?”
Mr Trump also issued a furious spray over China’s retaliation against his tariffs, threatening to impose additional levies of 50 per cent and terminate all negotiations with Beijing.
“… if China does not withdraw its 34 per cent increase above their already long term trading abuses by tomorrow, April 8th, 2025, the United States will impose additional tariffs on China of 50 per cent, effective April 9th,” Mr Trump wrote.
“Additionally, all talks with China concerning their requested meetings with us will be terminated!
“Negotiations with other countries, which have also requested meetings, will begin taking place immediately. Thank you for your attention to this matter!”
However, China has since said it would not cave to pressure or threats.
“We have stressed more than once that pressuring or threatening China is not a right way to engage with us. China will firmly safeguard its legitimate rights and interests,” Liu Pengyu, spokesman for Beijing’s embassy in the United States, told AFP.
Mr Trump also seemed to respond directly to Mr Ackman that he was unmoved by his entreaties.
“Oil prices are down, interest rates are down (the slow moving Fed should cut rates!), food prices are down, there is NO INFLATION, and the long time abused USA is bringing in Billions of Dollars a week from the abusing countries on Tariffs that are already in place,” Mr Trump wrote on Truth Social.
“They’ve made enough, for decades, taking advantage of the Good OL’ USA! Our past ‘leaders’ are to blame for allowing this, and so much else, to happen to our Country.”
He doubled down in a subsequent post where he coined a new term for people who “panic”.
“The United States has a chance to do something that should have been done DECADES AGO. Don’t be Weak! Don’t be Stupid! Don’t be a PANICAN (A new party based on Weak and Stupid people!). Be Strong, Courageous, and Patient, and GREATNESS will be the result!”
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‘SOMETIMES YOU HAVE TO TAKE MEDICINE’
US President Donald Trump has said that violent falls in American and global markets showed the “medicine” of his trade tariff barrage was working.
“Sometimes you have to take medicine to fix something,” Mr Trump told reporters aboard Air Force One as he returned to Washington from a weekend of golfing in Florida, adding that trade partners are “coming to the table” and “want to talk.”
It comes as more than 50 countries have sought talks with President Donald Trump in a scramble to ease punishing tariffs on exports to the United States, the White House said as trade partners braced for fallout.
The Republican has remained defiant since unleashing the blitz of levies on stunned countries around the world last week, insisting that his policies “will never change” even as markets went into a tailspin.
But his staggered deadlines have left space for some countries to negotiate, even as
he insisted he would stand firm and his administration warned against any retaliation.
“More than 50 countries have reached out to the president to begin a negotiation,” Kevin Hassett, head of the White House National Economic Council, told CNN on Sunday, citing the US Trade Representative.
He said they were doing so “because they understand that they bear a lot of the tariffs,” as the administration continues to insist that the duties would not lead to major price rises in the United States.
“I don’t think that you’re going to see a big effect on the consumer in the US,” he said.
Treasury Secretary Scott Bessent also told NBC that 50 countries had reached out.
But as for whether Mr Trump will negotiate with them, “I think that’s a decision for President Trump,” Mr Bessent said.
“At this moment he’s created maximum leverage for himself … I think we’re going to have to see what the countries offer, and whether it’s believable,” Mr Bessent said.
Other countries have been “bad actors for a long time, and it’s not the kind of thing you can negotiate away in days or weeks,” he claimed.
Mr Trump has long insisted that countries around the world that sell products to the United States are in fact ripping Americans off, and he sees tariffs as a means to right that wrong.
But many economists have warned that tariffs are passed on to consumers and that they could see price rises at home. Meantime, the uncertainty over trade and manufacturing has helped fuel a days-long panic in global markets.
The Saudi stock exchange was down 6.78 per cent on Sunday, official data showed.
The state-run Al-Ekhbariya television reported online that “the Saudi stock index closed trading down (nearly) 7 per cent, losing more than 800 points”, calling it “the largest daily loss in five years” since the early days of the Covid-19 pandemic.
‘COOL HEADS’: UK NAVIGATES NEW WORLD ORDER
The “world as we knew it” is over and the UK “stands ready” to use direct state intervention to shelter industries from the US tariff storm, Prime Minister Keir Starmer said Sunday.
US President Donald Trump’s imposition of sweeping tariffs on Wednesday shows that “old assumptions can no longer be taken for granted,” Starmer said in a op-ed for the Sunday Telegraph newspaper.
“The world as we knew it has gone,” he wrote.
The new world will be governed less by established rules and “more by deals and alliances,” added the prime minister.
“It demands the best of British virtues – cool heads, pragmatism and a clear understanding of our national interest,” he said.
The UK leader reiterated his government’s belief that “nobody wins from a trade war” and that the immediate strategy was “to keep calm and fight for the best deal.”
However, he insisted a US trade deal will only be struck “if it is right for British business” and that “all options remain on the table” in responding to the 10 per cent tariffs on the UK.
In an immediate sign of the tariff fallout, UK luxury car manufacturer Jaguar Land Rover said on Saturday that it will “pause” shipments to the United States in April as it addressed “the new trading terms”.
Recognising the shifting global economic sands, Starmer said that he was now prepared to use direct state intervention to protect certain sectors.
“This week we will turbocharge plans that will improve our domestic competitiveness,” he wrote, ahead of an expected major announcement on industrial strategy.
“We stand ready to use industrial policy to help shelter British business from the storm.
“Some people may feel uncomfortable about this … but we simply cannot cling on to old sentiments when the world is turning this fast,” he said.
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Originally published as Wall Street reels from historic slump after Trump’s fresh trade threats
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