By Wayne Cole
President Donald Trump told reporters that markets would have to take their medicine and he would not do a deal with China until the U.S. trade deficit was sorted out.
Investors had thought the loss of trillions of dollars in wealth and the likely body blow to the economy would make Trump reconsider his plans.
“The size and disruptive impact of U.S. trade policies, if sustained, would be sufficient to tip a still healthy U.S. and global expansion into recession,” said Bruce Kasman, head of economics at JPMorgan, putting the risk of a downturn at 60%.
“We continue to expect a first Fed easing in June,” he added. “However, we now think the Committee cuts at every meeting through January, bringing the top of the funds rate target range down to 3.0%.”
S&P 500 futures slid 4.31% in volatile trade, while Nasdaq futures dived 5.45%, adding to last week’s almost $6 trillion in market losses.
Japan’s Nikkei sank 7.8% (.N225), opens new tab to lows last seen in late 2023, while South Korea (.KS11), opens new tab lost 4.6%.
The gloomier outlook for global growth kept oil prices under heavy pressure, following steep losses last week.
Brent fell $2.12 to $63.46 a barrel, while U.S. crude dived $2.05 to $59.94 per barrel.
