Global stocks extended their selloff Friday as President Donald Trump’s sweeping new import tariffs stoked fears about global growth.
S&P 500 futures dropped more than 1%, pointing to a fourth straight day of declines. Amazon.com Inc. slid as much as 8% in premarket trading after lackluster earnings injected caution into an otherwise upbeat Big Tech reporting season.
The dollar and Treasury yields edged higher after Trump blasted the Federal Reserve on social media, urging its board to “assume control” if Chair Jerome Powell doesn’t cut rates. Traders are also bracing for July’s US jobs report, due later Friday.
Trump unveiled fresh levies — including a 10% global minimum and 15%-plus duties on countries with trade surpluses with the US — intensifying his push to reshape global commerce. The new measures are raising questions about their impact on growth and inflation, potentially overshadowing the AI-fueled optimism that has buoyed megacap tech stocks.
“Next week marks a turning point for global trade,” said Kim Heuacker, associate consultant at Camarco. “High US valuations are becoming increasingly hard to justify.”
Europe’s Stoxx 600 fell over 1% to a one-month low, led lower by pharma names such as Novo Nordisk A/S, GSK Plc and AstraZeneca Plc after Trump demanded drugmakers cut US prices. The MSCI All Country World Index dropped for a sixth straight session — its longest losing streak since September 2023.
“The tariffs are really bad for Europe,” said Ludovic Subran, chief investment officer at Allianz SE. “The cost for companies will be huge, as the US is the biggest market by far.”
While Trump kept most baseline rates at 10% — unchanged from April — his decision to raise some Canadian tariffs to 35% threatens to strain relations further. Bloomberg Economics estimates the average US tariff would rise to 15.2% under the new plan, up from 13.3% previously and well above the 2.3% level seen in 2024 before Trump returned to office.
Bloomberg strategists warn that seasonal weakness, soft earnings, and a strong euro leave European equities vulnerable: “Tariffs and lackluster growth remain persistent headwinds for the rest of the year,” said Nour Al Ali of Macro Markets & Squawk.
Markets now await the July jobs data, expected to show hiring moderating and unemployment edging up to 4.2%. “Given the uncertainties, it makes sense for traders to take some money off the table ahead of nonfarm payrolls,” said Gareth Nicholson, CIO of Nomura International Wealth Management.
