Grim New Year? Stock market’s fear gauge surges after Fed policy; Donald Trump's potential tariffs could be critical for U.S economy, equities in 2025
Market Reaction
The stock market responded negatively to these developments. The S&P 500 plunged 3.03%, while the Nasdaq 100 sank 3.74%. The Dow Jones dropped 1,103 points (-2.54%), marking one of the steepest declines since September 2022. These broad market routs reflect investors' growing concerns about the economic outlook and potential policy changes.
Investor sentiment is currently cautious, with many watching closely how Trump's administration will navigate these trade policies. The fear gauge's rise indicates that market participants are bracing for volatility and potential downturns in equity markets as the implications of these tariffs unfold.
Also Read: These three darlings of AI will be the first companies to join the $4 trillion club in 2025, says Dan Ives
Impact of Trump's proposed Tariffs
Donald Trump's presidency looms large over the financial community's concerns. The possibility of Trump implementing tariffs or other trade policies could have significant implications for global markets and trade relationships. Trump's trade agenda, which includes a 10% across-the-board tariff on all trading partners and significantly higher tariffs on goods from China, raises concerns about increased costs for consumers and businesses alike.
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