Global financial markets experienced a severe downturn on Monday, extending a three-day selloff that has erased approximately $9.5 trillion in equity value. S&P 500 futures indicated a 3% loss, the VIX volatility index spiked above 50, Europe’s Stoxx 600 tumbled 5%, and Asian markets saw their worst day since 2008. Investors sought safety in Treasury bonds and the Japanese yen.
The selloff intensified after President Trump showed determination to proceed with tariffs despite recession warnings from prominent economists and criticism from hedge fund managers, including supporter Bill Ackman. Trump’s comment to reporters to “forget markets for a second” signaled his disregard for Wall Street’s concerns.
Traders now expect the equivalent of five quarter-point interest rate cuts from the Federal Reserve this year, with a 40% chance of an emergency cut before the scheduled May meeting. Major companies like Tesla, Apple, Amazon, and Citigroup saw significant stock price drops, while European and Asian markets reached multi-month lows. Chinese policymakers reportedly discussed stimulus measures to stabilize their economy amid the global turmoil.