Despite a bloodbath on Thursday following the tariff announcements on several U.S. trading partners, President Donald Trump dismissed the concerns while talking to reporters before boarding Air Force One for his Miami visit.
What Happened: President Trump compared the decline in the stock market to a patient’s operation and said, “I think it’s going very well, it was an operation… It’s a big thing. I said this would be exactly the way it is. We have $6-$7 trillion coming into our country, and we have never seen anything like it.”
“The market is going to boom, the stock is going to boom, the country is going to boom, and the rest of the world wants to see if there is any way they could make a deal,” he added.
He made these claims after the U.S. stocks had their worst one-day sell-off since 2020. Both the Dow Jones and the S&P 500 saw their worst trading day since June 2020, and the Nasdaq had its most significant single-day decline since March 2020. Dow’s 1,679-point drop was the fifth-worst in its history.
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Why It Matters: Citing the necessity to rectify the United States’ trade deficit, Trump utilized a 1977 statute to officially declare a trade emergency, subsequently introducing new tariffs on Wednesday.
He imposed a blanket 10% tariff on all trading partners and levied more duties on the countries he described as “bad actors”.
It is worth noting that China, Vietnam, Cambodia, and Sri Lanka are subject to the most severe tariffs, whereas Canada and Mexico were exempted.
The benchmark indices have moved into correction territory, defined by a decline exceeding 10% from their recent high points.
The S&P 500 index, which peaked at 6,147.43 points on February 19th, has since fallen by 12.22%. Meanwhile, the Nasdaq 100 has seen a more significant drop of 16.65% from its 52-week high of 22,222.61 points, nearing the -20% mark that signifies a bear market.
The Dow Jones Industrial Average, as of Thursday’s close, was also down, trading 10.05% below its prior high of 45,073.63 points.
Price Action: The SPDR S&P 500 ETF Trust SPY and Invesco QQQ Trust ETF QQQ, which track the S&P 500 index and Nasdaq 100 index, respectively, dropped in premarket trade on Friday. The SPY was down 0.54% to $533.79, while the QQQ declined 0.47% to $448.54, according to Benzinga Pro data.
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