Wednesday Evening Shake - Markets Update - 9 Apr 2025 - Treasuries, Dollar Sink as Trump’s Tariffs Spark Recession Fears; Tech Lifts U.S. Stocks

Markets Update: A fresh escalation in the U.S.–China trade war rattled global markets on Wednesday, driving U.S. Treasuries and the dollar sharply lower while lifting gold to fresh highs and putting renewed pressure on the global growth outlook.

Global Markets Roundup: 9 Apr 2025

President Donald Trump's extensive 104% tariffs on Chinese imports came into effect on Wednesday, and Beijing quickly responded with retaliatory duties of 84%. This tit-for-tat escalation caused turmoil in financial markets, raising fears that the trade conflict might push the global economy into a recession.

U.S. Treasuries Sell Off Amid Bond Market Jitters

The U.S. bond market saw massive liquidations, with benchmark 10-year Treasury yields spiking 19.2 basis points to 4.45%, their highest in seven weeks. Overnight trading volume was more than four times the average, fueling speculation that China may be offloading U.S. debt in response to the tariffs.

U.S. Stocks Edge Up as Tech Rebounds

Despite the global market turmoil, U.S. equities managed modest gains, driven by a rebound in technology stocks.

Dow Jones Industrial Average: +167.93 points (+0.45%) to 37,813.52
S&P 500: +33.11 points (+0.67%) to 5,015.97
Nasdaq Composite: +217.21 points (+1.43%) to 15,486.85

The rally followed four days of steep losses that wiped out $5.8 trillion in S&P 500 market value, according to LSEG, marking the sharpest four-day decline since the index’s inception.

The Cboe Volatility Index (VIX) eased but remained elevated after hitting its highest level since August. Wall Street’s attention now shifts to earnings season, which begins Friday with reports from JPMorgan, Citigroup, and Wells Fargo. Investors are looking for clues on how corporate America is managing tariff-induced inflation and supply disruptions.

Global Markets Wobble as Recession Fears Mount

MSCI World Index: -0.32% to 740.61
Europe’s STOXX 600: -3.5%, its fourth straight session of losses
China’s CSI 300: -7%, steadied only after reports of state fund buying
Hong Kong’s Hang Seng: -13%, its worst day since 1997

JPMorgan cautioned that the tariff on China could result in a $400 billion tax increase for U.S. businesses and consumers, potentially further constraining growth and increasing the chances of a global recession.