Editor's Note: This page is a summary of news on tariffs and the stock market for Monday, April 7. For the latest news, view our story for Tuesday, April 8.
The battered U.S. stock market endured a turbulent day Monday − sinking then rising before mostly sinking again − as President Donald Trump doubled down on an aggressive, sweeping tariff plan and threatened to slam China with an additional 50% levy.
U.S. stocks fought back in the afternoon, but it wasn't enough to combat conflicting tariff news before the day's close.
The blue-chip Dow closed down 0.96%, or 366.54 points, to 37,948.32; the broad S&P 500 fell 0.23%, or 11.90 points, to 5,062.18. But the tech-heavy Nasdaq edged up 0.1%, or 15.48 points, to 15,603.26. The benchmark 10-year yield rose to 4.22%, and gold slipped but held near its record high.
Trump said Monday that he’s not considering pausing his recently imposed tariffs, which have sent the stock market spiraling, but he is willing to negotiate the duties with other nations.
Asked about mixed messages on the topic from White House officials, Trump told reporters at the Oval Office: "There can be permanent tariffs and there can also be negotiations, because there are things that we need beyond tariffs. We need open borders.''
Trump, in a series of posts earlier Monday on Truth Social, urged Americans to be "strong, courageous and patient." And he accused China of gaining an unfair trade advantage by subsidizing its companies and manipulating currency, ripping the trade giant for hitting the U.S. with retaliatory tariffs in response to the steep tariffs Trump has placed on China.
Trump added that tariff negotiations with leaders of other countries will begin “immediately.” He said several have requested meetings.
Trump announced on April 2 a 10% tariff on all countries, effective over the weekend. Even higher tariffs on dozens of nations are set to start Wednesday. A 34% levy was placed on China − on top of recently imposed 20% tariffs on Chinese goods.
China hit back with a 34% tariff on all U.S. imports, while other countries around the world denounced Trump's moves and threatened their own retaliatory tariffs. European leaders met in Luxembourg on Monday to discuss the European Union’s response to Trump’s latest tariffs. Global stock markets plunged on Monday.
More: Trump tariffs put stock markets in a frenzy – but not nearly as crazy as in 1929 or 1987
Developments:
∎ Treasury Secretary Scott Bessent said on the X platform Monday afternoon that he and other members of the administration will hold trade negotiations with the Japanese government after Prime Minister Shigeru Ishiba and Trump spoke on the phone.
∎ Bitcoin prices fell below $80,000, a key psychological threshold, and are now down more than 15% for the year after soaring in the aftermath of Trump's election.
What is Smoot-Hawley? The Depression-era act being compared to Trump's tariffs
Hyper volatility leaves three indexes more than 15% below peak
Another day of extreme volatility on Wall Street concluded with two of the major indexes down and the third up slightly. More significantly, all three are more than 15% below their peaks. The Nasdaq is in a bear market, or more than 20% below its record high, and the S&P 500 dipped into one during Monday’s session.
Stocks opened sharply lower only to pop up briefly into positive ground after CNBC reported that Trump would delay tariffs for 90 days. The White House denied the report, the outlet's story was taken down and stocks swung lower again.
Stocks fell further after Trump threatened on Monday to impose an additional 50% tariff on China if the Asian nation doesn’t withdraw its retaliatory tariff set to go into effect on Wednesday. “Additionally, all talks with China concerning their requested meetings with us will be terminated!” Trump wrote on social media.
Some investors tried to find some bargains in the rubble of the worst decline since the pandemic in 2020, giving the market a bit of a boost. “Is it time to buy the dip? If stocks haven’t bottomed, we think they are close,” analysts at LPL Financial wrote in a commentary. They also said the market may be close to “a level at which the president may step in to try to support stocks before this downdraft goes much further.”
Worries that tit-for-tat tariffs will boost inflation and push the global economy into recession have sparked stock market selloffs around the globe, even as experts urge investors to stay calm.
What is a bear market? Stocks take dive amid Trump tariffs, worries of trade war
Are tariffs negotiable? White House sends mixed signal
Trump and top members of his administration sent mixed signals Monday on whether the tariffs he has imposed are up for negotiation.
When asked at the White House about a possible pause on tariffs, Trump first said, "We're not looking at that." But when another reporter asked for a clarification on whether they're negotiable or permanent, Trump responded: "There can be permanent tariffs and there can also be negotiations, because there are things that we need beyond tariffs. We need open borders.''
Earlier in the day, Bessent said Trump had directed him to “open negotiations” on tariffs with Japan, and around the same time the White House promoted a Financial Times op-ed from Peter Navarro, Trump’s senior counselor for trade and manufacturing, that relayed the opposite position.
“This is not a negotiation,” Navarro wrote of the tariffs policy. “For the US, it is a national emergency triggered by trade deficits caused by a rigged system. President Trump is always willing to listen. But to those world leaders who, after decades of cheating, are suddenly offering to lower tariffs − know this: that’s just the beginning."
Navarro singled out leaders of Cambodia, Mexico and Vietnam, saying they need to stop allowing China to evade U.S. tariffs by trans-shipping exports through their countries.
More: Dow and S&P 500 entered correction territory after Trump tariffs. What does that mean?
Economy 'weakening as we speak,' Wall Street leader says
On the third consecutive day of stock market volatility, some of the leading figures in the financial world refrained from directly hitting Trump's tariffs but still expressed reservations about their impact.
JP Morgan CEO Jamie Dimon, a prominent voice on Wall Street, said in a letter to shareholders the tariffs would probably raise inflation and "are causing many to consider a greater probability of a recession."
Diamon said he hoped the duties would eventually benefit the U.S. but added, "My most serious concern is how this will affect America’s long-term economic alliances."
Larry Fink, CEO of asset management giant BlackRock, also expressed inflation worries and likewise made room for the possibility the tariffs could help Americans down the road, by persuading other countries to alter their trade policies toward the U.S.
"Most economic theory is that tariffs raise the value of the currency. I think it’s going to weaken the dollar,'' Fink said, according to social media posts from the Economic Club of New York, where he spoke. "One thing I would say with certainty is that the economy is weakening as we speak.''
− Kinsey Crowley
Economist sees impending recession if tariffs remain
The U.S. is likely to be in a recession in the second quarter if tariffs are not rolled back, and the turmoil in financial markets is a sign investors are starting to take the risk seriously, said Diane Swonk, chief economist for KPMG.
“Financial markets were more hopeful that this was more just a negotiating tool, and the reality set in that it wasn't,” she said.
Perhaps even more worrisome for Wall Street is the Federal Reserve will likely need to hold off on cutting interest rates for longer than it might in other scenarios, Swonk told USA TODAY, because the Fed knows it can’t cut in a period of stagflation, which is rising inflation and falling growth.
“If you cut too soon, any gains you get in employment are quickly reversed by another flare-up of inflation, especially in the context in which we're at, where the embers of inflation are still smoldering,” she said.
Swonk forecast one rate cut at the end of 2025, which she believes is a lot later than financial markets would like. “It's time to start calling your Congress people,” she said, “because Congress does have the power to actually curb the executive branch's ability to levy tariffs with the stroke of a pen, and to get more certainty.”
White House denies considering 90-day pause in tariffs
The White House on Monday said Trump is not considering a 90-day pause on his tariffs, rejecting an earlier report from CNBC.
“Wrong. Fake news,” the White House said on its rapid response X account.
The CNBC on-air report said Trump was considering a 90-day pause of his tariffs except for China. But the the report was based on an interview economic adviser Kevin Hassett conducted earlier in the day on Fox News in which Hassett defended Trump’s tariffs and did not embrace a timeout.
“I think the president is going to decide what the president is going to decide,” Hassett, director of Trump’s National Economic Council, said when asked about a potential pause.
Steven Cheung, the White House’s communication director, rejected the report of Trump considering a pause: “Not true. Nobody can point to a transcript … because it was never said,” he wrote on X.
'Stocks will go up,' market strategist says
While investor jitters led to choppy markets Monday, at least one investment expert told USA TODAY that stock prices may have been slashed enough that much of the risk is now in the rearview mirror.
"People are losing money,'' said Keith Lerner, co-chief investment officer and chief market strategist at Truist, which warned in February that investors were too complacent about the risks from a potential trade war. "But I would say, it’s a time to take a deep breath and remember some of the really challenging things we’ve been through, like COVID, when we shut down the economy and we didn’t know what was going to happen next. Stocks will go up."
Big market selloffs are often followed by significant swings in both directions over the following weeks, he noted.
"Back in February, when we downgraded stocks, there was a lot of complacency," Lerner said. "Now every single headline is negative. If we get any inkling of positive news, we could have a snap back."
More: Jamie Dimon, Larry Fink and Bill Ackman warn of economic outlook with Trump's tariffs
Speaker Johnson says to 'give the president space' on tariffs
Amid the economic turbulence caused by Trump's tariffs, Republicans in Congress have mostly stood behind him even while acknowledging concerns about the levies' impacts on their constituents and the economy as a whole.
Asked whether he trusts Trump's plan on tariffs, House Speaker Mike Johnson, R-La., told reporters Monday that people "have to give the president space."
"His strategy is playing out. It's been less than a week, so I think he's owed that," Johnson said.
− Riley Beggin
Hedge fund manager warns of 'economic nuclear winter'
Trump's trade war is putting some high-profile allies on edge, exposing cracks in his coalition as the economic fallout from tariffs grows. Bill Ackman, an influential hedge fund manager who endorsed Trump, posted on social media Sunday that the president should call a "time out" on tariffs.
"Alternatively, we are heading for a self-induced, economic nuclear winter, and we should start hunkering down. May cooler heads prevail," the billionaire wrote on X.
− Zac Anderson
'Economic nuclear winter': Trump allies worried over tariffs
Could recession start 'very quickly'?
The U.S. faces a “very high” likelihood of a recession, said Steve Blitz, managing director of global macro strategies and chief U.S. economist at Global Data, as the higher costs from tariffs cause firms to lay off workers and consumer and business sentiment takes a hit.
“The danger is it could start happening very quickly,” Blitz told USA TODAY.
While the 10-year Treasury note might attract some buyers in the short term, pushing down yields and making things like mortgages and other credit products more affordable for consumers, that’s likely to fade quickly, Blitz thinks. For one thing, there will be fewer foreign buyers of America’s debt.
Blitz doesn’t expect the Fed to react to the pain in the markets, but to wait until unemployment starts to rise before cutting interest rates. Given the economic turmoil, that may not have much impact, Blitz said.
Are we going into a recession? Why it's not too late to prepare.
Global markets sink as Trump stands firm
Global markets crashed on Monday after Trump stood firm on his tariff plan, sparking worries an all-out trade war would plunge the global economy into recession.
In Asia, Hong Kong’s Hang Seng led losses with a 13.22% decline, followed by Japan’s Nikkei, which lost 7.84%. China’s Shanghai index dropped 7.34% and Australia’s ASX 200 fell 4.23% to hit a 52-week low.
European markets didn’t fare much better with stock indexes in London, France and Germany all losing 4% to 5%. The pan-European Stoxx 600 index fell up to 6% earlier in the session, but slightly pared losses to close 4.54% lower.
Stressed by market upheaval? 'It can get worse,' CEO says
The volatile markets of the last several days impact the majority of the U.S. population, considering an estimated 62% of Americans own stocks. And the worst part of the recent decline might not be over.
That's according to Tom Callahan, CEO of Nasdaq Private Market, a secondary trading marketplace for brokers, issuers and shareholders.
“Everything can always get worse,'' Callahan said Monday. "Until there’s more certainty and clarity, and as long as we are at these extreme levels of uncertainty, we will continue to see volatility in the market. Of course, it can get worse.”
Callahan said the uncertainty is why many are debating whether to buy or sell shares and why companies such as Klarna, StubHub and Chime are reportedly delaying their initial public offerings. The current volatility index opened Monday at 60, meaning significant market stress, for the first time since August. The index finished the day at 46.98, lower but still above the previous session's closing figure of 45.31.
“We’re at extreme levels of uncertainty in terms of volatility,” Callahan said. “I guess it’s the rate at which it’s happening when you have $11 trillion of value wiped off the market since January, the speed and size of it are incredibly sudden and shocking to people.”
− Terry Collins
Trump urges Americans to 'hang tough' as markets skid
The tariff war has pummeled the stock market amid concerns of inflation and recession. Last week, the Dow posted back-to-back losses of more than 1,500 points for the first time ever, including a 2,231-point freefall on Friday. The S&P 500 on Friday posted its biggest one-day loss since March 2020, the start of the COVID-19 pandemic, and Monday morning tumbled into a bear market.
A bear market is defined as at least 20% below its recent peak. The tech-heavy Nasdaq was already in a bear market.
Even with the stock market drubbing, Trump's administration has stood firm. Trump continues to tell Americans to "hang tough," adding on Sunday that "sometimes you have to take medicine to fix something.”
Stocks have dropped: What does it mean for your 401(k)?
‘Don’t be a PANICAN,' Trump says as markets dive
Trump encouraged Americans to be patient on Monday morning as the markets tumbled in response to his tariffs. Trump, in a series of social media posts, defended his blanket tariffs of 10% on most countries.
““Don’t be Weak! Don’t be Stupid! Don’t be a PANICAN (A new party based on Weak and Stupid people!),” Trump said. “Be Strong, Courageous, and Patient, and GREATNESS will be the result!”
In another, he admonished China for responding to an announced tariff hike of 34% on its imports with a matching increase on U.S.-made goods that are shipped to the country.
After the Nikkei index in Japan dropped 7.8%, Trump said in a post that he’d spoken to the country’s prime minister, Shigeru Ishiba, and a team would be coming to the U.S. to negotiate the tariffs.
“Countries from all over the World are talking to us. Tough but fair parameters are being set,” he said.
Vietnam offer to drop tariffs not enough
On Monday morning, Trump trade adviser Peter Navarro said on CNBC even Vietnam's offer to eliminate tariffs on U.S. imports would not be enough for the administration to lift its new levies announced last week. He said there was still a lot of cheating, such as Chinese products routed through Vietnam, intellectual property theft and a value added tax, going on. Vietnam's elimination of tariffs would only be a small first step.
JP Morgan Chase CEO Jamie Dimon issues warning on tariffs
JP Morgan Chase CEO Jamie Dimon said Monday that tariffs "will likely increase inflation and are causing many to consider a greater possibility of a recession." Dimon, in a letter to shareholders of the nation's largest bank, described the financial landscape as "unsettling" but said the U.S. economy has shown resiliency "at least until recently." He said consumer are still spending and businesses remain mostly healthy. He also acknowledged Trump's recurring criticism of the federal deficit.
"It is important to note that the economy has been fueled by large amounts of government deficit spending and past stimulus," Dimon said.
Barstool Sports founder blames tariffs, continues to back Trump
Dave Portnoy, millionaire founder of the media company Barstool Sports, knocked the struggling stock market, attributing his and others' losses to Trump's tariffs.
"The last three days coming into today has just been, you know, not good," Portnoy said in a livestream on X, where he has 3.6 million followers.
"Don't call it Black Monday, it's orange Monday," Portnoy said later, in the same livestream after markets had opened. "Trump's tariffs have absolutely decimated the market. And it's ugly."
Yet Portnoy said his support for the president is not shaken. "100%, no questions asked," he would still vote for Trump if the election were today, he said. "Not even a question."
"I hate what is going on with my stock market. I don't like the way he rolled out the tariffs," Portnoy said. "I can accept the guy who campaigned on tariffs doing exactly what he said. I don't like the manner in which he did it. I think he probably could have done it a little less abrasively."
Trump digs in amid market woes, calls tariffs ‘medicine’
With the stock market further plummeting, Trump on Sunday night defended his massive tariffs that have rattled investors, telling reporters: "Sometimes you have to take medicine to fix something.” Trump's remarks came before another day of rapid swings Monday on Wall Street in response to Trump’s larger-than-expected tariffs on all imports.
"What's going to happen with the market? I can't tell you," Trump said aboard Air Force One as he returned from his Mar-a-Lago Florida home, where he had stayed since Thursday. "But I can tell you our country has gotten a lot stronger, and eventually, it'll be a country like no other."
Trump pushed back when a reporter asked whether there's a level of pain in the stock market that he's unwilling to tolerate.
"I don't want anything to go down, but sometimes you have to take medicine to fix something," Trump said. "We have been treated so badly by other countries because we had stupid leadership that allowed this to happen. They took our businesses, they took our money, they took our jobs, they moved it to Mexico, they moved it to Canada, they moved a lot of it to China."
Trump has argued that higher tariffs — which seek to roll back decades of globalization — are critical to rejuvenate America's declining domestic manufacturing sectors and create a level playing field with other countries that impose tariffs on U.S. exports.
Is there any chance the tariffs can be postponed or negotiated?
Commerce Secretary Howard Lutnick told CBS News over the weekend that tariffs would not be postponed. Treasury Secretary Scott Bessent said in a NBC interview 50 countries have approached the administration for negotiation but warned these could take time. Bessent also said he didn't believe tariffs would lead to recession.
Some economists still believe tariffs will settle at lower levels. "We still think he will lower the dosage by paring back his tariffs," said Thomas Mathews, head of amrkets, Asia Pacific, for Capital Economics. "But, if he doesn’t, equities could get a lot sicker yet."
Prominent Wall Street executives including hedge fund billionaire Dan Ackman and JPMorgan Chase chief executive Jamie Dimon have called on Trump to pause or reverse his tariff plan.
Bankrate Chief Financial Analyst Greg McBride said "while investors are no stranger to sharp downside volatility – 2020 and 2022 both produced bear markets – the speed of the decline since Thursday morning is unique, and is particularly unsettling. Investors should resist the urge for the knee-jerk reaction of selling."
Oil and crypto fall on recession fears
Stocks aren't the only asset losing value quickly. Oil prices tumbled on fears a recession would dent demand at the same time the Organization of the Petroleum Exporting Countries and its allies plan to increase production next month.
Trump touted the fall in oil prices in a social media post and again, urged the Federal Reserve to lower interest rates saying there is "no inflation."
However, Fed Chair Powell signaled Friday the Fed isn’t rushing in to cushion the blow from tariffs. He said the Fed is “well positioned to wait for greater clarity before considering any adjustments to our policy stance.”
Bitcoin also fell below the key $80,000 level overnight and is near the lowest level since Trump's election win on Nov. 6. The digital asset was last down 1.03% at $77,709.08.
Gold prices today down but holding near record high
Gold prices were down Monday morning but holding close to their record high reached last week amid the market tumult. Gold is seen as a safe-haven during turbulent times.
Strong central bank buying reportedly has helped the yellow metal, too.
Gold was last down 0.31% at $3,026.10 per ounce.
What is a recession?
A recession is informally considered at least two straight quarters of declining economic output. But the technical definition is “a significant decline in economic activity that is spread across the economy and lasts more than a few months,” according to the nonprofit National Bureau of Economic Research.
The measure is based on employment, income, consumer spending and industrial production, among other criteria. An economic tailspin is typically accompanied by hundreds of thousands or millions of net job losses.
What exactly is a recession? Economists say odds of one in the US are 'very high'
Medora Lee is a money, markets and personal finance reporter at USA TODAY. You can reach her at mjlee@usatoday.com and subscribe to our free Daily Money newsletter for personal finance tips and business news every Monday through Friday morning.
This article originally appeared on USA TODAY: Stock market swings up and down amid new China Trump threats