Friendly fire leaves US markets as biggest loser

The S&P 500 was down 4.2% in afternoon trading, more than other major stock markets, and at its bottom in the morning was on track for its worst day since Covid struck in 2020. The Dow Jones Industrial Average was down 1,394 points, or 3.3%, as of 2:09 p.m. Eastern time, and the Nasdaq composite was 5.3% lower.

Little was spared in financial markets as fear flared globally about the potentially toxic mix of higher inflation and weakening economic growth that tariffs can create.

Everything from crude oil to Big Tech stocks to the value of the US dollar against other currencies fell. Even gold, which has hit records recently as investors sought something safer to own, pulled lower. Some of the worst hits walloped smaller US companies, and the Russell 2000 index of smaller stocks dropped 5.9% to pull it more than 20% below its record.

Investors worldwide knew Trump was going to announce a sweeping set of tariffs late Wednesday, and fears surrounding it had already pulled Wall Street's main measure of health, the S&P 500 index, 10% below its all-time high. But Trump still managed to surprise them with «the worst case scenario for tariffs,» according to Mary Ann Bartels, chief investment officer at Sanctuary Wealth.

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Trump announced a minimum tariff of 10% on imports, with the tax rate running much higher on products from certain countries like China and those from the European Union. It's «plausible» the tariffs altogether, which would rival levels unseen in roughly a century, could knock down US