Following the nosedive seen in the previous session, stocks are likely to show another significant move to the downside in early trading on Friday. The major index futures are currently pointing to a sharply lower open for the markets, with the S&P 500 futures down by 3.0 percent.
Ongoing concerns about a global trade war are likely to weigh on Wall Street after China announced retaliatory tariff on U.S. goods in reaction to President Donald Trump's new levies.
China's finance ministry announced a 34 percent tariff will be imposed on all imported goods originating from the U.S. beginning on April 10.
The new tariff matches the "reciprocal tariff" Trump plans to impose on China, although the country will face a 54 percent effective rate when the new levies are combined with existing duties.
The ministry called Trump's tariff plan a "typical unilateral bullying practice" that is "inconsistent with international trade rules."
"China urges the United States to immediately cancel its unilateral tariff measures and resolve trade differences through consultation in an equal, respectful and mutually beneficial manner," the ministry said, according to a Google translation.
Canada and the European Union are also preparing countermeasures, leading to concerns about a trade war that could fuel inflation and damage the global economy.
The futures remained sharply lower even after a closely watched Labor Department report showed employment in the U.S. surged by much more than expected in the month of March.
The Labor Department said non-farm payroll employment jumped by 228,000 jobs in March after climbing by a downwardly revised 117,000 jobs in February.
Economists had expected employment to rise by 135,000 jobs compared to the addition of 151,000 jobs originally reported for the previous month.
Meanwhile, the report said the unemployment rate crept up to 4.2 percent in March from 4.1 percent in February. The unemployment rate was expected to remain unchanged.
Later this morning, Federal Reserve Chair Jerome Powell is scheduled to speak on the economic outlook at the Society for Advancing Business Editing and Writing's annual conference.
Stocks plummeted during trading on Thursday amid concerns about a global trade war following President Donald Trump's tariff announcement. The sell-off dragged the Nasdaq and the S&P 500 down to their lowest levels since last August, while the Dow slumped to a nearly seven-month closing low.
The major averages saw further downside going into the close, ending the session near their worst levels of the day. The Nasdaq plummeted 1,050.44 points or 6.0 percent to 16,550.61, the S&P 500 plunged 274.45 points or 4.8 percent to 5,396.52 and the Dow tumbled 1,696.39 points or 4.0 percent to 40,545.93.
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower on Friday, with markets in Hong Kong and mainland China closed for a holiday. Japan's Nikkei 225 Index dove by 2.8 percent, while Australia's S&P/ASX 200 Index slumped by 2.4 percent.
The major European markets have also shown substantial moves to the downside. While the German DAX Index is down by 4.1 percent, the French CAC 40 Index and the U.K.'s FTSE 100 Index are both down by 3.9 percent.
In commodities trading, crude oil futures are plummeting $4.80 to $62.15 a barrel after plunging $4.76 to $66.95 a barrel on Thursday. Meanwhile, after tumbling $44.50 to $3,121.70 an ounce in the previous session, gold futures are edging down $1.80 to $3,119.90 an ounce.
On the currency front, the U.S. dollar is trading at 145.20 yen versus the 146.06 yen it fetched at the close of New York trading on Thursday. Against the euro, the dollar is unchanged compared to yesterday's $1.1052.
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April 04, 2025 10:36 ET President Donald Trump’s ‘Liberation Day’ reciprocal tariffs dominated the news flow this week and raised worries about a full-blown trade war in future. Several survey data were also released that threw light on the manufacturing and services sectors. In Europe, inflation data for March underpinned hopes for more interest rate cuts from the European Central Bank. Survey data on the Chinese factory sector and the interest rate decision in Australia were among the main news in Asia this week.