World stock markets nosedive again amid Trump’s tariff ‘medicine’

European and Asian shares saw dramatic losses, the leading U.S. index flirted with bear market territory in pre-market trading, and oil prices sagged.

Global stock markets extended a severe plunge Monday, fuelled by fears that U.S. tariffs would lead to a global economic slowdown. European and Asian shares saw dramatic losses, the leading U.S. index flirted with bear market territory in pre-market trading, and oil prices sagged.

The massive sell-off in riskier assets at the start of the trading week follows President Donald Trump’s announcement of sharply higher U.S. import taxes and retaliation from China that saw markets fall sharply Thursday and Friday.

Tokyo’s Nikkei 225 index lost nearly 8 per cent shortly after the market opened and futures trading for the benchmark was briefly suspended. It closed down 7.8 per cent at 31,136.58.

European shares followed Asian markets lower, led by Germany’s DAX index, which briefly fell more than 10 per cent at the open on the Frankfurt exchange, but recovered some ground to move down 5.8% in morning trading. In Paris, the CAC 40 shed 5.8 per cent, while Britain’s FTSE 100 lost 4.9 per cent in the European morning.

U.S. futures signaled further weakness ahead. For the S&P 500, they lost 3.4 per cent, while for the Dow Jones Industrial Average, they shed 3.1 per cent. Futures for the Nasdaq lost 5.3 per cent. If the pre-market futures losses materialize when the U.S. market opens, the S&P 500 will enter bear market territory — defined as a fall of more than 20% from the peak. The index was off 17.4 per cent as of the end of last week.

On Friday, the worst market crisis since the COVID-19 pandemic shifted into a higher gear as the S&P 500 plummeted 6% and the Dow plunged 5.5 per cent. The Nasdaq composite dropped 3.8 per cent.

“There’s no sign yet that markets are finding a bottom and beginning to stabilize,” wrote Deutsche Bank analysts in a research note.

Late Sunday, Trump reiterated his resolve on his decision to introduce tariffs of 10 per cent to 50 per cent on goods imported into the U.S., a move seen as massively disrupting world trade and supply chains across borders. Speaking to reporters aboard Air Force One, he said he didn’t want global markets to fall, but also that he wasn’t concerned about the massive sell-offs, adding, “sometimes you have to take medicine to fix something.”