The benchmark S&P 500 experienced a decline of 1.39 percent, resulting in a correction and pushing the index more than 10 percent below its peak in February. This downturn in the United States’ stock market follows President Donald Trump’s threat to impose steep tariffs on wine and other alcoholic products from the European Union.
This recent decline is not uncommon in the US stock market, as it has consistently recovered from losses throughout its history. The S&P 500 last entered correction territory in October 2023, when the index fell 10.3 percent from its July peak. Similarly, the Dow Jones Industrial Average and Nasdaq Composite also witnessed sharp declines, falling 1.30 percent and 1.96 percent, respectively.
These losses have led to US stocks losing more than $5 trillion in market value since their February peak. Investors have been unsettled by Trump’s back-and-forth announcements regarding trade, as they struggle to determine whether his tariffs are meant to be temporary bargaining tactics or lasting measures.
According to financial newsletter Kobeissi Letter, the main difference between Trump’s first and second term is the duration of the trade war. Investors are now pricing in tariffs for a longer period on a wider range of trade partners, which represents a significant change. In this latest trade action, Trump has threatened to impose a 200 percent tariff on wine and other alcoholic products from the European Union, in response to the bloc’s planned 50 percent tariff on US bourbon whiskey.
Trump has played down the stock market turmoil, stating that the economy is going to boom and that he is choosing the hard way to achieve results.
Source: https://www.aljazeera.com/economy/2025/3/14/us-stock-market-takes-another-tumble-as-trump-threatens-tariffs-on-wine?traffic_source=rss
