China vows to ‘fight to the end’ on President Trump’s tariffs
President Donald Trump threatened China with more tariffs after they put a 34% tariff on U.S. imports.
April 9 (Reuters) – U.S. stock index futures struggled on Wednesday after a heavy sell-off in the previous session, as President Donald Trump‘s reciprocal tariff took effect, deepening worries about their damage to the global economy.
As hopes of concessions faded and tariffs on dozens of countries, including a massive 104% duties on Chinese goods, came into force, investors accelerated their exit from stocks and industrial commodities.
Prospects of tariff deals had lifted U.S. equities on Tuesday, though gains were not sustained and all three major indexes closed down.
Since Trump unveiled his tariffs last Wednesday, the S&P 500 .SPX has shed more than $5.83 trillion in market value and will confirm a bear market, if it closes more than 20% below its record high. As of last close, it was down 19% from its peak.
At 04:52 a.m. ET, Dow E-minis 1YMcv1 were down 155 points, or 0.41%, S&P 500 E-minis EScv1 were down 6.75 points, or 0.13% and Nasdaq 100 E-minis NQcv1 were up 53.25 points, or 0.31%.
“By announcing sweeping tariffs, the U.S. is fundamentally changing its role in the global trading order,” John Velis, Americas macro strategist at BNY said in a note.
The CBOE Volatility index .VIX – seen as Wall Street’s ‘fear gauge’ – was last at 49.1 points, hovering nearing its highest since August.
Most megacap and growth stocks though ticked higher in premarket trading, with Tesla TSLA.O and Nvidia NVDA.O leading the pack with a more than 2% jump each.
Meanwhile, government bond yields rose and prices dropped as rising fears of a U.S. recession boosted expectations of interest-rate cuts by the Federal Reserve.
The yield on the 10-year note US10YT=RR briefly jumped to its highest level since February and was last at 4.34%.
Traders see more than 100 basis points of easing by the December, implying four fully priced-in 25-basis-points cuts, according to LSEG data.
Minutes from the Fed’s March policy meeting are due later in the day, while a consumer price inflation reading is set for Thursday, which could offer more clues on the inflation trajectory.
Bucking the trend, U.S.-listed shares of Chinese firms saw robust gains, tracking advances in their domestic peers as state holding companies and Chinese brokerages continued to support the market.
E-commerce giant Alibaba BABA.N gained 7% and Temu-parent PDD Holdings PDD.O advanced 3.5%, while the iShares MSCI China ETF MCHI.O added 5.8%.
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(Reporting by Shashwat Chauhan in Bengaluru; Editing by Arun Koyyur)
