The tariff selloff showed little sign of ending early Friday, as recession fears pushed investors to sell stocks and hide in the safety of government bonds.
Markets took little comfort from President Trump's willingness to negotiate over the tariffs. The levies, unveiled late Wednesday, were deeper and more aggressive than the business world expected. And even as Trump left the door open to making deals, he vowed new tariffs on drugs and microchips.
Traders ramped up bets on big rate cuts this year, judging the Federal Reserve will have to step in to shore up the U.S. economy. Economists at JPMorgan warned they now saw a 60% chance of a global recession. Oil prices slid again, with benchmark U.S. crude falling below $65 a barrel.
Fearing a global trade war and economic contraction, investors rushed into Treasurys, pushing 10-year yields below 4% early Friday. Bonds in other big economies, like Japan, Germany and the U.K., also rallied. Bond yields fall as prices rise.
Stock futures pointed to more selling pressure on U.S. equities, albeit with less intensity than Thursday, which saw a $3.1 trillion wipeout in the worst day for U.S. stocks since March 2020. Some global markets took fresh hits. Japan's benchmark stock index fell more than 2.7%.
Up ahead, investors will get a read on the health of the labor market in the run-up to Trump's "Liberation Day" tariffs, through the monthly jobs report, due at 8:30 a.m. ET.
A speech on the economic outlook by Fed Chair Jerome Powell will also be watched very closely. Investors will be hungry for insight into how the central bank chief sees tariffs affecting jobs, inflation and growth, and the prospects for future rate cuts.
This item is part of a Wall Street Journal live coverage event. The full stream can be found by searching P/WSJL (WSJ Live Coverage).
(END) Dow Jones Newswires
April 04, 2025 06:18 ET (10:18 GMT)
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