Global stocks and crypto tumble as Trump’s new tariffs shake markets. | Credit: Spencer Platt/Getty Images
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Key Takeaways
Stocks in Japan and South Korea led global declines after Trump announced 25% tariffs on auto imports.
The Nasdaq slumped over 2%, with GM and Ford losing 6% and 5%, respectively.
Bitcoin, XRP and crypto-related stocks also tumbled as investors pulled out of risk assets.
Global markets took a sharp hit after President Donald Trump announced steep new tariffs on auto imports, sending shockwaves from Tokyo to Wall Street.
The sell-off extended beyond equities, with cryptocurrencies and related stocks also facing steep losses.
While retail investors saw the decline as an opportunity to buy the dip, institutional players remained on the sidelines, signaling deeper uncertainty ahead.
Japan and South Korea bore the brunt of the market decline, with the Nikkei 225 falling 1% and South Korea’s KOSPI slipping 1.3%. Automakers were hit hardest—Toyota lost 2.6%, while Mazda and Subaru both plunged around 6%.
European markets opened weaker, with the Euro Stoxx 50 down 0.5% and the FTSE 100 slipping 0.2%.
The impact spread to U.S. markets, where the Nasdaq fell over 2%, led by losses in major automakers. General Motors sank 6%, while Ford dropped 5%. The Dow Jones shed 0.3%, and the S&P 500 declined 1.1%.
The tech-focused Nasdaq index fell by over 2% after Trump announced new tariffs. | Credit: MarketWatch
Chinese markets fared better, with the CSI300 rising 0.4% and the Hang Seng Index gaining 1%. Trump hinted at possible flexibility on China tariffs, particularly regarding TikTok, which helped support investor sentiment.
In currency markets, the dollar index dipped 0.3% to 104.32, while the euro rebounded 0.3% to $1.0780. The yen strengthened slightly, trading at 150.21 per dollar.
Crypto Market Struggles Alongside Equities
The sell-off in traditional markets extended into crypto, with the global market cap slipping to $2.85 trillion—a 0.8% decline over the past 24 hours.
Riot Platforms (RIOT) was the worst performer. | Credit: Yahoo! Finance
Crypto-related stocks followed suit. Riot Platforms (RIOT) was the hardest hit, plunging 7.2% to $7.90. MARA fell 3.2% to $13.79, Strategy (MSTR) lost 3.7% to close at $329.31, and Coinbase (COIN) dropped 5.1% to $193.95.
Japan’s Metaplanet also suffered, falling 5.1% to 4,795 yen.
Investors Shift Money Away From U.S. Markets
Foreign investors are pulling billions out of U.S. equities as economic uncertainty grows.
Data from The Kobeissi Letter shows that roughly $6 billion flowed out of U.S. equity funds last week, marking the third-largest weekly outflow on record—comparable to levels seen in March 2020.
Meanwhile, retail traders are aggressively buying the dip, creating a sharp divergence between Wall Street’s caution and Main Street’s optimism.
Foreign investors are pulling out from Wall Street. | Credit: The Kobeissi Letter/Bank of America
Adding to the unease, Trump’s economic advisors have warned of “short-term pain for long-term gain,” reinforcing expectations that inflation-fighting policies could remain in place for longer.
Analysts suggest that Federal Reserve Chair Jerome Powell may align with this approach, which could mean prolonged economic tightening ahead.
With markets on edge, investors are bracing for more volatility in the weeks to come.
Giuseppe Ciccomascolo began his career as an investigative journalist in Italy, where he contributed to both local and national newspapers, focusing on various financial sectors.
Upon relocating to London, he worked as an analyst for Fitch's CapitalStructure and later as a Senior Reporter for Alliance News. In 2017, Giuseppe transitioned to covering cryptocurrency-related news, producing documentaries and articles on Bitcoin and other emerging digital currencies. He also played a pivotal role in establishing the academy for a cryptocurrency exchange website. Crypto remained his primary area of interest throughout his tenure as a writer for ThirdFloor.
