Global markets plunged on Monday morning after US president Donald Trump showed no signs of pulling back from his tariff agenda and suggested investors would have to take their “medicine”.
Speaking to reporters after returning from a weekend of golf in Florida on Sunday, Mr Trump said he did not necessarily want markets to go down as a result of the reciprocal tariffs he announced last week. “But sometimes you have to take medicine to fix something,” he said.
The Iseq All-Shares index was down by more than 3 per cent when trading on the Euronext Dublin opened at 8am.
European markets were also a sea of red when they opened, with the German Dax index down 9 per cent in early trading as shares in defence stocks like Rheinmettall and Thyssenkrupp plunged.
Shares in European banks were also under water with HBSC and Barclays down by at least 5 per cent in London while France’s BNP Paribas, Spain’s BBVA and Santander and Dutch lender ING all plummeted by more than 7 per cent.
Earlier in the morning, Asian markets also plunged, with emerging market stocks logging one of their worst days since the 2008 financial crisis, Bloomberg reported.
In the US, S&P 500 futures slid 3.5 per cent in volatile trade, while Nasdaq futures dived 4.4 per cent, adding to last week’s almost $6 trillion (€5.45 trillion) in market losses.
“The only real circuit breaker is president Trump’s iPhone, and he is showing little sign that the market sell-off is bothering him enough to reconsider a policy stance he has believed in for decades,” said Sean Callow, a senior FX analyst at ITC Markets in Sydney.
Investors had thought the loss of trillions of dollars in wealth and the likely body blow to the economy would make Mr Trump reconsider his plans.
“The size and disruptive impact of US trade policies, if sustained, would be sufficient to tip a still healthy US and global expansion into recession,” said Bruce Kasman, head of economics at JPMorgan, putting the risk of a downturn at 60 per cent.
Chinese blue chips lost 6.3 per cent, as markets waited to see if Beijing would respond with more stimulus. Taiwan’s main index, which had been shut on Thursday and Friday, tumbled nearly 10 per cent, leading policymakers to curb short selling.
All of emerging Asia was also under water, with India’s Nifty 50 sinking 4 per cent.
The gloomier outlook for global growth kept oil prices under heavy pressure, following steep losses last week.
Brent fell $1.35 to $64.23 a barrel, while US crude dived $1.395 to $60.60 per barrel. - Additional reporting: Reuters
