RIGHT NOW: Responding with its own tariffs – the stock market plummets

Trump's tariffs

China responds with its own tariffs against the US

Anna Sjögren,

Oskar Forsberg

Updated 14.11 | Published 12.18

China will introduce tariffs of 34 percent on all imports from the US.

The announcement caused the Stockholm Stock Exchange to plummet.

– It is a tariff war that we are seeing now, says Frida Bratt, savings economist at Nordnet.
Quick version

• China is introducing tariffs of 34 percent on all imports from the US, which has caused concern on the world's stock markets and a sharp drop on the Stockholm Stock Exchange.
• The announcement has led to the indices on the New York Stock Exchange and several European and Asian stock exchanges falling, with a historically bad trading day reported for Nasdaq.
• The escalating tariff war between China and the US is increasing the risk of a global economic downturn, which could have long-term consequences for investors and consumers globally.

China will impose tariffs of 34 percent on all imports from the US. The tariffs will be imposed on April 10.

This is reported by AFP and Bloomberg with reference to the Chinese Xinhua News Agency. Eleven American companies will also be listed as "unreliable entities".

The Stockholm Stock Exchange fell back clearly after the announcement.

- We see that the stock market is turning sharply downward. There are no winners in this. That there would be a response to Trump's tariffs was expected, but China's response is a confirmation that we are in a tariff war, says Frida Bratt.

Shortly after lunch, the OMXS30 was down 2.6 percent. The broad OMXSPI index fell from minus 1.1 percent to minus 2.3 percent after the Chinese announcement. By 1:40 p.m., the stock market had plummeted further.

And the indices continue to fall.

Chinese President Xi Jinping during a party meeting in Beijing in late March. Photo: Ng Han Guan / AP

Worst trading day since the pandemic

US President Donald Trump has previously announced heavy tariffs on goods from China.

The New York Stock Exchange recorded its worst trading day since the pandemic yesterday, with the Nasdaq Composite Index down around 6 percent.

TT reports.

Red numbers everywhere

Around $3.1 trillion in market value was wiped out during the trading day in New York, while the probability of an American recession in the economy has risen from a previous 38 to the current 48 percent, writes the Wall Street Journal.

Europe's leading stock exchanges are also showing red numbers.

The London Stock Exchange is down 0.8 percent and Frankfurt and Paris are down 0.9 percent.

Leading stock exchanges in Asia, led by the Tokyo Stock Exchange, are also continuing to decline today.

How low the stock market can fall and how long the slump can last is impossible to predict, according to Frida Bratt.

– What would put the market in a good mood is dialogue and starting negotiations instead of raising tariffs. But if there are more responses with increased tariffs, this could be prolonged.

How does this affect Swedes' wallets?

– If you have long-term savings on the stock exchange, you should wait this out. If you sell now, you could miss out on the recovery. If you have money that you need in the next year, you should consider that this could get worse.

The American and Chinese tariffs are affecting the countries' own consumers. But Swedes can also prepare for tougher times. Partly if the EU responds with increased tariffs against the US.

– But this tariff war is expected to damage the economy in general. The US in particular risks falling into a recession, and it could also spread to more countries, says Frida Bratt.