US shares fall again, reality check on Wall Street

US shares fall again, reality check on Wall Street

The US exchanges, which recently recorded one of the best days in modern history, are back into reality: Although President Donald Trump temporarily suspended most of his so-called "reciprocal" tariffs, the existing import tax have already caused considerable damage. The economy will be difficult to recover from the consequences.

Current market development

After the Dow rose almost 3,000 points on Wednesday, it was again at a lower level of over 500 points on Thursday, which corresponds to a decline of 1.3 %. The S&P 500 futures fell by 1.7 % and the Nasdaq futures by 1.9 %. The S&P 500 had its best day since 2008 on Wednesday. The Nasdaq also recorded the second largest daily profits in history on this day.

reactions of the dealers

retailers were thrilled that Trump suspended the "reciprocal" tariffs, which were raised between 11 % and 50 % on numerous countries for 90 days. The futures also reacted positively to the announcement of the European Union to temporarily suspend its retaliation tariffs against the United States, in the hope of a negotiated trade agreement after Trump's change of course.

reality in economic growth

Despite this positive news, the reality remains dark: economists warn that the economic damage has already been caused, and many predict a recession in the USA and worldwide. The share prices are still significantly below the level that they had before the introduction of Trump's tariffs.

permanent tariffs and uncertainties

The general 10%customs fee that came into force on Saturday remains. In addition, 25 % tariffs on auto imports and 25 % tariffs on steel and aluminum are still valid. Trump also announced that it would introduce further tariffs on pharmaceuticals, wood, semiconductor and copper.

economic experts on the risk of recession

Goldman Sachs recently found that the chances of a recession after Trump's partial accommodation are still 50 %. JPmorgan sticks to his forecasts and still sees a 60%probability for a recession, despite Trump's "positive" decision.

China's reaction to the trade war

On the tensions with China Trump explains that he increased the tariffs to Chinese imports to 125 %, while the 84 % tariff China also comes into force on US imports. However, China has confirmed that it is ready for negotiations, but will not make concessions if the United States further escalate the conflict.

stress in the financial markets