‘Black Monday 2’ fears rise as inventory futures sink sharply once more as Trump tariff fallout escalates
Wall Street is bracing for a potential repeat of Black Monday tomorrow — and last week’s brutal sell-off could look tame by comparison.
Despite President Donald Trump claiming Sunday night that world leaders are ‘dying to make a deal,’ US stock futures tanked.
Futures for the S&P 500, Nasdaq, and Dow all plunged between 4.2 and 6 percent — a clear signal that last week’s $6.6 trillion wipeout was just the beginning.
Meanwhile, in Japan stocks plunged 6 per cent, in South Korea by 4.7 percent and Australia by 2.75 percent when markets opened there on Monday morning, qhixh ia Sunday night US time.
CNBC host and market analyst Jim Cramer on Saturday warned of a potential repeat of the 1987 ‘Black Monday’ crash if Trump doesn’t reconsider.
Cramer pointed out that the 1987 crash saw the Dow Jones plunge 22.6 percent in just one day — still the worst one-day drop in history. He said the current volatility could lead to a similar event.
‘If the president doesn’t reach out and reward countries and companies that follow the rules, then the 1987 scenario… where we dropped for three days and then plunged 22 percent on Monday, becomes highly relevant,’ Cramer said during his show on Saturday.
Long-time CNBC talking head Jim Cramer (pictured) warned that the economy could genuinely ‘crash’ if Donald Trump continues with his tariff program
Trump boards Air Force One as he departs for Washington, at Palm Beach International Airport, West Palm Beach, Florida, on Sunday. He had been in Florida for the LIV golf tournament
The Dow Jones tanked 508 points, a fall of nearly 23 percent, in a chaotic, daylong selling frenzy that ricocheted around the world
Futures for the three main indices —the S&P 500, the Nasdaq, and the Dow — were all down between 4.2 and 6 percent at 7.20pm, after an hour and 20 minutes of trading. Traders fear tariffs will cause a global recession.
Each had already dropped at least 10 percent In the two days following Trump’s Wednesday announcement of sweeping tariffs on nearly 90 countries.
This follows the worst two-day wipeout in US stock market history on Thursday and Friday — with $6.6 trillion wiped off the value companies.
A stock market rout does not just affect the big US companies. Most Americans have their retirement savings in the form of 401(K)s or IRAs linked to shares.
Trump’s 10 percent ‘baseline’ tariff came began Saturday, hitting all US imports except goods from Mexico and Canada. Come April 9, higher levies on goods from 57 larger trading partners – including the European Union.
On Sunday night, Trump denied he was intentionally engineering a market selloff and insisted he could not foresee market reactions, saying he would not make a deal with other countries unless trade deficits were solved.
‘Sometimes you have to take medicine to fix something,’ he said of the market pain.
Speaking to reporters aboard Air Force One — as he returned from the LIV golf tournament at his course in Miami — he added that he had engaged with world leaders on the issue to seek resolution over the weekend, claiming ‘they’re dying to make a deal.’
Thursday and Friday’s steep slide pulled the S&P500 down more than 17 percent from its February 19 record close — bringing it closer to bear market territory, defined as a 20 percent drop
‘The bull market is dead,’ said Mark Malek, chief investment officer at Siebert Financial. ‘We might see some gains in the next few days, but for now they´re not going to be sustainable.’
Malek also pointed to poor timing — the tariff announcement came just as first-quarter earnings season was getting underway — adding to investor anxiety.
On Sunday morning talk shows, Trump’s top economic advisers sought to portray the tariffs as a savvy repositioning.
Treasury Secretary Scott Bessent said on NBC News’ ‘Meet the Press’ that there was ‘no reason’ to anticipate a recession.
The White House announced a baseline 10 percent tariff on all imports, effective April 5, with higher rates for countries imposing steeper duties on US goods on Wednesday, which Trump declared ‘Liberation Day’
President Trump slapped 34 percent tariffs on all Chinese imports
A trader looks at a sea of red among stock prices during another stock market downturn (stock image)
Some analysts believe the market may attempt a short-term bounce.
‘Sometime this week it´s probably inevitable that we will have an up day,’ said Steve Sosnick, chief investment strategist at Interactive Brokers.
The question remains about the sustainability of any rally.
‘We may see a day this week where screens are green, but any lasting rally may not arrive for three or four weeks,’ said Alex Morris, chief investment officer at F/m Investments.
‘At that point, people will start saying we´ve taken enough air out of the balloon.’
Trump’s new tariffs will cause higher prices, job losses and lower growth, Jerome Powell warned Friday
The chair of the Federal Reserve, which sets interest rates for the US, issued the chilling outlook as he said the central bank faces tough decisions ahead as it navigates the economic fallout.
Wall Street analysts had expected the Fed to go beyond its planned two rate cuts for 2025 as recession fears grow over the new tariffs.
But Powell said the central bank won’t make any moves until it has a clearer sense of the fallout.
The Fed controls interest rates, which impact borrowing costs for families and businesses. It raises them to cool inflation and lowers them to spur growth.
Powell spoke Friday as global markets continued a massive sell-off that has wiped some 10 percent off major US stock indexes since Trump announced a raft of new tariffs on Wednesday.
And major global companies also changed plans amid terror at Trump’s tariffs crippling the world markets. On Friday, Nintendo delayed pre-orders of its new console at the 11th hour. Dodge-maker Stellantis announced abrupt layoffs Thursday.
