Cliff Notes

Global stock markets plummeted overnight, with Japan’s Nikkei 225 falling nearly 8% and US stock market futures indicating further declines, as fears of a trade war escalate following President Trump‘s new tariffs.

Trump defined his sweeping tariffs as “medicine” for trade imbalances, warning foreign governments they must pay considerably to lift these tariffs, signalling an inflexible stance in ongoing negotiations.

China’s retaliatory tariffs, matching Trump’s, have raised concerns about the feasibility of trade between the world’s largest economies, prompting fears of a looming global recession.

International stock markets tumble as Trump calls tariffs ‘medicine’

International stock markets have fallen dramatically overnight amid fears of a global trade war following Donald Trump’s sweeping tariffs, which he called “medicine”.

Japan’s Nikkei 225 stock index dived nearly 8%, the Singapore benchmark index fell 6.8%, Australia’s S&P/ASX 200 fell more than 6%, and South Korea’s Kospi lost 4.4%.

Meanwhile US stock market futures signalled further weaknesses, with the future for the S&P 500 losing 4.2% and the Dow Jones Industrial Average falling 3.5%, while the future for the Nasdaq lost 5.3%.

“I don’t want anything to go down. But sometimes you have to take medicine to fix something,” he said on Air Force One.

The US president said he had spoken to leaders from Europe and Asia over the weekend who had hoped to convince him to lower further “reciprocal” tariffs, which are due to come into effect this week.

“I spoke to a lot of leaders, European, Asian, from all over the world,” Mr Trump said. “They’re dying to make a deal. And I said, we’re not going to have deficits with your country. We’re not going to do that because to me, a deficit is a loss. We’re going to have surpluses or, at worst, going to be breaking even.”

Mr Trump, who spent much of the weekend playing golf in Florida, posted on his Truth Social platform: “WE WILL WIN. HANG TOUGH, it won’t be easy.”