Trump's Tariff Strategy: the Brutal Impact on Global Equity Markets and Cryptocurrencies

Trump's Tariff Strategy: the Brutal Impact on Global Equity Markets and Cryptocurrencies

Global equity markets are experiencing turbulent times, which can be attributed to the decisions of US President Donald Trump, whose tariff policy has hit not only traditional investments but also cryptocurrencies. In his statement, Trump assured reporters that the decline of the markets was not his intention, adding: "Sometimes we need to take medicine to fix something."

Tariff Blows: How the Trump Administration Changed the Game

On April 5, the Trump administration imposed tariffs of 10% on all countries, with even higher tariffs on some, such as China (34%), the European Union (20%) and Japan (24%). These unexpected moves have caused a wave of panic in the markets, leading to a dramatic drop in stock prices and cryptocurrencies. Bitcoin fell by more than 6% to around $76,326, while ether lost more than 12%, trading at $1,499. The total market capitalisation of cryptocurrencies fell by more than 8% to reach $2.5 trillion.

Markets in a Panic: The Aftermath of the Plunge

Although cryptocurrency prices later partially recovered, the market for Bitcoin and other cryptocurrencies experienced extreme fear, as confirmed by the Crypto Fear & Greed Index with a score of 23. Charlie Sherry, head of finance at Australian crypto exchange BTC Markets, said such a drop is not surprising, especially on a Sunday when markets are less liquid and larger sell-offs can quickly push prices down.

But according to some analysts, a bitcoin breakout could be on the horizon. The co-founder of BitMEX exchange, Arthur Hayes, suggested that although tariffs are rocking the markets, they could also result in a Bitcoin rally.

Stock Markets on Knees: A Bear Trend

Futures on the S&P 500 index have fallen nearly 4%, while the tech-heavy Nasdaq and Dow Jones Industrial Average have lost more than 8%. Kobeissi Letter warned that the decline in U.S. stock market futures could drive the S&P 500 into a "bear market," with U.S. stocks erasing an average of $400 billion a day over the past 32 days.

Tom Dunleavy, a partner at MV Global, said that if current trends hold, it could be the "worst three-day move in US stocks ever".

Trump's Strategic Play

Trump, who is trying to resolve huge financial deficits with China and the European Union, has stressed that tariffs are necessary to preserve the U.S. economy. In a statement on Truth Social, he said the levies are bringing tens of billions of dollars to the U.S. and that it is important for other countries to respond.

He went on to say that he was not intentionally trying to cause a market downturn, but that his administration is prepared for further negotiations and trade agreements with more than 50 countries that have already expressed interest in changing their terms of trade.


Conclusion: what's next for us?

Donald Trump's tariff strategy is creating a wave of uncertainty that is rocking global markets. While markets react to the short-term shocks, traders and investors remain wary of whether the policy will lead to a longer-term recovery or further declines. It is clear that the future of equities and cryptocurrencies will continue to be affected by the actions taken by the US administration in the coming weeks.

*This is not an investment recommendation.


Coingarage Team