President Donald Trump's announcement of tariffs on at least 60 countries, including Australia, led to a significant downturn in global markets. On Thursday, markets experienced a broad decline of 4.84%, the worst single-day loss since mid-2020.
The market downturn affected major technology companies, with Apple shares falling approximately 8% and Amazon.com down 7%. Nvidia, a leader in artificial intelligence chips, decreased by about 6%. The Dow Jones Industrial Average fell by 3.98%.
Investors sought safe-haven assets as the dollar weakened against major currencies. The S&P 500 dropped over 3%, and the Nasdaq Composite sank over 4%. US Treasury 10-year yields fell to their lowest level since mid-October, slightly above 4%.
President Trump stated that his tariffs plan is "going very well" and anticipates significant investment flowing into the US. He believes the US is "healing" following the implementation of tariffs ranging from 10% to 49% on all imports.
The European Union and Canada have announced plans to impose retaliatory tariffs on the US. China has stated it will take "countermeasures to safeguard its interests". Australian Prime Minister Anthony Albanese criticized the tariffs but stated Australia would not respond with retaliatory measures. Key sectors, such as Australia's beef industry, may face significant impacts.
The Reserve Bank of Australia may be compelled to implement four rate cuts in 2025.