Dow drops 1,100 as U.S. stock market leads a worldwide sell-off following Trump’s tariff announcement

Global markets plummet as Trump announces severe tariffs, causing U.S. stocks to drop significantly on April 3, 2025.

Financial markets around the world are reeling on Thursday (April 3, 2025) following President Donald Trump’s latest and most severe volley of tariffs, and the U.S. stock market may be taking the worst of it.

The S&P 500 was down 3.3% in early trading, worse than the drops for other major stock markets. The Dow Jones Industrial Average was down 1,160 points, or 2.7%, as of 9:32 a.m. Eastern time, and the Nasdaq composite was 4.5% lower.

Little was spared as fear flared globally about the potentially toxic mix of higher inflation and weakening economic growth that tariffs can create. Prices fell for everything from crude oil to Big Tech stocks to small companies that invest only in U.S. real estate. Even gold, which has hit records recently as investors sought something safer to own, pulled lower. The value of the U.S. dollar also slid against other currencies, including the euro and Canadian dollar.

Trump tariff announcement LIVE updates

Investors worldwide knew Trump was going to announce a sweeping set of tariffs late Wednesday, and fears surrounding it had already earlier pulled the S&P 500 10% below its all-time high. But Mr. Trump still managed to surprise them with “the worst case scenario for tariffs,” according to Mary Ann Bartels, chief investment officer at Sanctuary Wealth.

Mr. Trump announced a minimum tariff of 10% on imports from all countries, with the tax rate running much higher on products from certain countries like China and those from the European Union. It’s “plausible” the tariffs altogether, which would rival levels unseen in roughly a century, could knock down U.S. economic growth by 2 percentage points this year and raise inflation close to 5%, according to UBS.

Such a hit would be so frightening that it “makes one’s rational mind regard the possibility of them sticking as low,” according to Bhanu Baweja and other strategists at UBS.