The U.S. stock market took a tumble Thursday morning in response to President Donald Trump’s sweeping tariff policy unveiled Wednesday afternoon.
The Dow Jones opened with a 1,200 point drop as the S&P dropped more than 3% and the NASDAQ fell nearly 4%.
Markets slightly rose Wednesday ahead of the tariff details but plunged Thursday morning.
Trump has acknowledged there may be some pain as tariffs roll out, but he and his allies argue the tariffs will help generate revenue and level the playing field in global trade.
The reciprocal tariffs generally tax imports from countries that have tariffs against the U.S.
Critics say the tariffs will spike costs for Americans when companies pass on the cost of taxes to consumers.
“If tariffs stay in effect as announced, foreign sellers will likely absorb some of the cost, as will American importers,” Bill Adams, chief economist for Comerica Bank in Dallas, said in a statement. “But even so, the increase will likely cause a 3% to 5% cumulative incremental increase in consumer prices above the trend rate of inflation over the next year.”
Trump appeared to compare the tariff announcement to a surgery in a statement released online after his new policies were released.
“The operation is over!” Trump wrote in all capital letters. “The patient lived, and is healing. The prognosis is that the patient will be far stronger, bigger, better, and more resilient than ever before.”
