Trump’s 104% tariff on China takes effect at midnight, eliminating earlier market growth
The U.S. said on Tuesday that even if the Trump administration quickly begins talks with other trading partners targeted by U.S. President Donald Trump, the 104% tariff on imports from China will take effect after midnight.
U.S. stocks fell for the fourth straight trading day on Tuesday since Trump announced last week, with the S&P 500 closing below 5,000 for the first time in nearly a year. Currently, the index accounts for 18.9% from its latest high on February 19, close to a 20% decline in defining a bear market.
LSEG data shows that since Trump announced last Wednesday, the S&P 500 companies have lost $5.8 trillion in stock market value, the deepest four-day loss since its creation in the 1950s.
Global markets have previously been hoped that Trump might be willing to negotiate a range of national and product-specific trade barriers he has established around the world’s largest consumer market.
The government has arranged talks with South Korea and Japan, two close allies and major trading partners, Italian Prime Minister Giorgia Meloni will visit next week.
“These are tailor-made, highly tailored deals,” Trump said at a White House event, signing an executive order aimed at boosting coal production. “We’ve talked to a lot of countries, over 70, and they all want to come in. Our problem is, we can’t see a lot that fast.”
However, the White House made it clear that as planned, up to 50% of country-specific tariffs will take effect at 12:01 a.m. ET.
As the trade war between the two escalates, China is in a vulnerable location. Andrew Chang then explains why the math used to determine President Donald Trump’s global reciprocity tariffs is misleading.
These tariffs are particularly sharp for China as Trump announced last week’s anti-election responsibility for imports has increased to 104%. China refuses to surrender to so-called “blackmail” and vows to “fight.”
Government officials said they would not prioritize negotiations with the world’s second economic power.
The United States itself will face a brand new 25% tariff on Wednesday at 12:01 am ET (from Canada) and never complies with the Canadian-Mexico Agreement (CUSMA) on a fully assembled vehicle imported from the United States
Fully assembled Kusma-compliant vehicles will also be subject to 25% tariffs when their non-Canadian and non-Mexican content is brought into Canada from the United States.
Prime Minister Mark Carney telegram said Canada would propose these countermeasures, and the Canadian finance minister confirmed on Tuesday that these are in progress.
“Canada continues to respond strongly to all unnecessary and unreasonable tariffs imposed by the United States on Canadian products,” Finance Minister François-Philippe Champagne said in a statement.
“No waiver… in the short term”
Trump’s widespread tariffs have increased concerns about a recession and upended decades of global trading order.
“At present, we have received guidance to prioritize our allies and trading partners, etc. Japan and South Korea,” White House economic adviser Kevin Hassett said in Fox News.
White House spokesman Karoline Leavitt said Trump’s tailor-made approach to negotiations with countries could take into account foreign and military aid and economic factors.
Trump’s chief trade negotiator Jamieson Greer told Congress that his office is working hard to work quickly but is not facing a specific deadline.
“The president is clear again that he has no exemptions or exceptions in the short term,” Greer told lawmakers.
China is preparing for a war of loss, with manufacturers warning about profits and scrambling to plan new overseas factories. Citi cites the increase in external risks, reducing its 2025 GDP growth forecast to 4.2%, from 4.7%.
Three-quarters of Americans expect prices to rise as Trump’s tariffs begin, according to a Reuters/IPSOS poll.
Consumer inventory
Chipmaker Micron told customers it will impose tariff-related surcharges starting Wednesday, while U.S. apparel retailers say they are postponing orders and postponing hiring. According to an industry group, Vietnam’s retail running shoes now retail for $220 for $155 when Trump’s 46% tariffs on the country came into effect.
Consumers stock when possible. “I’m buying anything twice as much – beans, canned food, flour, you said,” Thomas Jennings, 53, said in a shopping cart in the aisle at Walmart, New Jersey.
A wide-based price increase may not occur immediately, as tariffs will not be available for goods that have already transited before they take effect.
Market slides have prompted some business leaders, including those close to Trump, to urge the president to reverse the path. Global oil prices stabilized after falling to four-year lows.
Meanwhile, the European Commission is considering protesters on a variety of commodities including soy, nuts and sausages, although other potential items, such as bourbon, are excluded. Officials said they were ready to negotiate.
The 27-member group is struggling with tariffs on cars and metals that are already in place and faces 20% tariffs on other products on Wednesday. Trump also threatened to impose tariffs on EU alcoholic beverages.
European pharmaceutical companies are also concerned about the tariff consequences, warning European Commission President Ursula von der Leyen at a meeting that Trump’s tariffs will speed up the industry’s shift from Europe to the United States.
Markets in Asia, Europe and North America were issued Tuesday after losses on Tuesday after U.S. President Donald Trump announced global tariffs. Meanwhile, China vowed to “fight to the end” and held controversial consultations with the World Trade Organization.
