On Tuesday, stocks rebounded after another tough day on Wall Street. However, the broader American financial markets continue to signal significant concerns that one positive day cannot resolve. This is largely due to investors’ clear message: President Donald Trump’s trade war is making the United States an unsafe place for investment. By examining the broader markets and the assets traders are buying or selling, it becomes evident that Trump’s policies are affecting various sectors.
The Dow Jones Industrial Average has dropped 9.1% in the first three weeks of April, marking its worst performance for any April since 1932. Similarly, the S&P 500 has fallen 14% during Trump’s first term, which is the worst performance through April 21 for any president since records began in 1928. Even with a modest rebound on Tuesday, where major indexes rose over 2%, Trump still has a long way to go to avoid setting historical records.
The US dollar has also weakened significantly during Trump’s new term, falling 5.5%, which is the worst record since data collection began during former President Gerald Ford’s term in 1974. Bonds have seen sharp sell-offs, with yields surging. The 10-year US Treasury yield has risen to 4.4% just a month after it dropped below 4%.
Traders are pulling money out of American stocks and bonds and investing in opportunities outside the US. The MSCI All World index, excluding the United States, has risen 2.9% during Trump’s new term. Oil prices have dropped dramatically due to fears of a global recession, giving US crude its worst start to any presidential administration since Bill Clinton’s second term.
Gold, however, has surged nearly 25% during Trump’s new term, surpassing the previous record of 13.5% during Jimmy Carter’s term in 1977. The International Monetary Fund reported that Trump’s trade war is sending the global economy into shock, predicting rapidly slowing economic growth, especially in the US, while inflation is set to rise.
David Solomon, CEO of Goldman Sachs, noted on CNBC that the uncertainty around Trump’s ever-changing policies has hurt businesses’ ability to make necessary adjustments. “The level of uncertainty is too high. It’s not productive,” he said. “It will have an effect on the growth of the economy, and we will see that, in my opinion, relatively quickly.”
— new from CNN