Global markets have tumbled after US President, Donald Trump, introduced a sweeping round of tariffs of at least 10 per cent on its trading partners, leaving investors unnerved.

Certain countries and industries were targeted with even higher rates, including China and the European Union, which faced tariffs of 54 per cent and 20 per cent respectively.

The UK got off ‘lightly’ and was hit with the 10 per cent baseline tariff, but the FTSE 100 fell by 1.4 per cent at the open as traders responded to concerns about the global economic impact of Trump’s trade policy.

Futures trades also indicated a sharp fall for the S&P 500, with S&P Futures falling by 1.7 per cent, while other indices around the world look set to follow suit.

“Trump’s bold attempt to reshape international trade has sent shockwaves through global markets,” commented Hargreaves Lansdown senior equity analyst, Matt Britzman.

“The effects of ‘Liberation Day’ are being felt far and wide, with Asian markets down overnight, European stocks under pressure in early trading, and US futures pointing to a big drop later today.

“The UK, meanwhile, may seem to have fared better than some, but its deep ties to the global economy make a slowdown in growth almost unavoidable and the FTSE 100 has been caught up in the global market sell-off."

Britzman noted that it was hard to find many winners, but gold prices continued to rally as investors flocked to safer assets, reaching a fresh all-time high in the aftermath of Trump’s announcement, before pulling back slightly this morning.

“There’s a lot of debate about whether gold adds real value to a portfolio in the long run, but investors are clearly leaning in to take some shorter-term risk off the table,” he stated.

Meanwhile, Quilter investment strategist, Lindsay James, said Trump had made it clear this was the end of the established economic order, and the tariffs were perhaps more aggressive than many in the market had been expecting.

“Ultimately, Trump is playing a high-risk game,” James continued. “He is risking stoking a fresh inflationary spiral in the hope that over time jobs and industry are restored to the US.

“This is following an election campaign where he promised to lower inflation and bring interest rates down. But tariffs have rarely ended in positive outcomes, and signs are already pointing to weakening consumer and business sentiment and the risk of a slowing US economy.

“Investors will need be patient and calm, staying invested for the long term.”

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