US stocks fell sharply, with the main index falling to a six-month low immediately after the opening bell, as Donald Trump's tariffs weighed on global financial markets.
The S&P 500 index fell about 4 percent in early trading on Wall Street, to 5,440, its lowest since September.
The Dow Jones Industrial Average fell about 3.6%, while the tech-heavy Nasdaq Index fell nearly 5%.
Mr Trump's initiatives to impose extensive import tariffs on various countries have sent shockwaves through international markets.
The president says his initiatives will bolster U.S. domestic manufacturing and support local goods, but economists warn the short-term impact will be higher prices and slower overall economic growth.
Markets in Europe and the UK also saw sharp falls following the recent White House address.
Germany's Dax index fell around 2.8%, while the Cac 40 index ended the day down 3.3%.
In Britain, the FTSE 100 index fell around 1.5% to a three-month low of 8,476 points.
The U.S. dollar extended its sharp decline against major currencies on Thursday, falling 2.5% against the euro to around 0.9 in afternoon trading, hitting a six-month low.
It also fell about 1.2% against the pound to 0.76.
A group of analysts at Barclays said in a note published Thursday that there is a “high risk that the US economy will fall into recession this year.”
Inflation is expected to rise and gross domestic product (GDP) to decline, increasing the likelihood of so-called “stagflation” in the economy.
Barclays also added that if a recession begins, companies may announce mass layoffs, which will lead to an increase in the unemployment rate in the country.
Chris Beauchamp, chief analyst at online trading platform IG, said: “The key feature of the last two years and more has been the resilience of the US economy.
“Trump’s tariffs, along with government job cuts and potential significant spending cuts, clearly have the potential to undermine an economy that has delivered consistent benefits.
“Certainly, Trump and his team hope that their tax reform and deregulation can lead to a recovery that will shock and tremble the world, but the challenges ahead will likely be tough on stock markets around the world.”
Sourse: breakingnews.ie
