The U.S. Stock Market closed much higher on Wednesday after experiencing tornadic interday volatility as the news of potential tariff wars hit the airwaves. Analysts and traders were scrambling to determine the potential impact of a trade war between China and the United States. Midday news of a potential agreement calmed the choppy trading waters enough for investors to step back into the wading pool.
However, this has left many distrustful since the proposed tariffs will affect almost every sector and affect multinational companies.
Thursday’s closing bell brought very modest gains:
Shortly after the closing bell on Thursday, President Trump made a surprise announcement, announcing his wish for an additional $100 B in tariffs on Chinese products. This has sent the futures on all indexes into a slide. Trump said in a statement:
“In light of China’s unfair retaliation, I have instructed the USTR to consider whether $100 billion of additional tariffs would be appropriate under section 301 and, if so, to identify the products upon which to impose such tariffs.” (source)
Jack Bogle, founder of Vanguard Group, and retired CEO commented on the volatility of the market during a Thursday interview.
“I have never seen a market this volatile to this extent in my career. Now that’s only 66 years, so I shouldn’t make too much about it, but you’re right: I’ve seen two 50-percent declines, I’ve seen a 25-percent decline in one day and I’ve never seen anything like this before.” (source)
Asian Markets are Down
The majority of Asian markets opened down Friday in response to Trump’s latest volley of intended tariffs aimed at products produced in China. Choppy trading is anticipated.
CNBC provided the list, as of April 3rd, of U.S. products that China proposes to place under tariff. Here’s the full list of US products that China is planning to hit with tariffs. According to FactSet, the technology segment is in place to suffer greatly from the proposed tariffs. These sectors and stocks could suffer the most collateral damage from China trade war.
Tarrifs Make Farmers say E-I-E-I-Ouch
U.S. farmers have been thrown into confusion at their most vulnerable time of the year. The following articles discuss in depth what the new tariffs could mean to their businesses:
- Blindsided by China Tariffs, American Farmers Suddenly Face Huge Decision
- U.S. Farmers Speak: ‘Let’s Just Hope This Is a War of Words’
You can expect more discussion of soybeans to follow.
Preppers should pay attention to the items that will be affected by tariffs, as these will be the things that become much more expensive over the coming months.