Stock markets fall after US tariffs spark trade war fears | Global News Avenue

President Donald Trump’s tariffs on goods entering the United States from China, Canada and Mexico, stock markets around the world fell.

Trump imposes a 25% tariff on imports from Canada and Mexico and a 20% tariff on China.

Canada and China have announced their own import taxes on U.S. goods, while Mexico said it had a “contingency plan”, which has raised concerns about a full-scale trade war.

After the news, three major U.S. stock market indexes sank, while the FTSE 100 index, the UK’s largest listed company, fell sharply on Tuesday, and Asian stock markets also fell.

Analysts warn that tariffs could push up prices for U.S. households and could also have an impact on global consumers, including the UK.

Trump threatened to impose tariffs, which are taxes added in Canada, Mexico and China as products enter a country to deal with unacceptable flows of illegal drugs and illegal immigrants entering the United States.

But Canadian Prime Minister Justin Trudeau said less than 1% of fentanyl in his country entered the U.S. and would retaliate against 25% tariffs on $150 billion worth of U.S. goods.

“There is no reason (US) action … Canada will not let this unreasonable decision not be answered,” Trudeau said in a statement Monday.

He said Canada will first target $30 billion worth of products and target the remaining $125 million in 21 days.

He said any new duties in Canada will be “until the U.S. trade lawsuit is revoked”, adding that if we no longer stop tariffs, his country will take “non-tariff measures” – not specifying what those measures are.

China quickly announced its own countermeasures, including tariffs on some U.S. agricultural products, including wheat, corn, beef and soy. China is the largest buyer of these goods in the United States.

“If the United States … insists on launching a tariff war, a trade war or any other war, the Chinese side will fight them,” said Foreign Ministry spokesman Lin Ji’an.

Before U.S. tariffs on Mexico imports came into effect, Claudia Sheinbaum said her country had contingency plans.

“In this case, we need calmness, peace and patience. We have Plan A, Plan B, Plan C and even Plan D.”

Sheinbaum said she will talk about Mexico’s response on Tuesday.

In the U.S., Dow Jones fell 1.5%, the S&P 500 ended 1.8% on Monday, while in Asia, Nikkekei 225 fell 1.2% and China’s Hang Seng Index fell 0.3%.

London’s FTSE 100 was lower in early trading, while major stock exchanges in Germany and France also fell.

Trump believes that tariffs will promote U.S. manufacturing and protect employment, as well as increase tax revenues and increase the economy.

However, such measures have adverse effects on consumers and businesses, including those they intend to protect.

Shoppers can be those who take most of the tariffs in the form of higher prices and have fewer choices.

Meanwhile, tariffs tend to trigger revenge in target countries, and adverse domestic companies want to export goods, meaning these measures can ultimately stop trade, create jobs and economic growth.

Commodities worth about $20 billion a day span the borders of the United States, Canada and Mexico, and their economies merge.

With tariffs on cross-border trade, companies that import goods may decide to transfer some or all additional fees to consumers by raising prices.

They can also reduce imports, which means fewer products and therefore higher demand, which can also drive up prices.

“What we’re seeing is the biggest increase in effective growth in U.S. tariffs since the 1940s – accompanied by serious economic risks,” said Andrew Wilson of the International Chamber of Commerce.

“The initial market movement is totally a reflection of a very risky solution we are now facing.” He told BBC Radio 4’s Today Programs.

He said Yale University has predicted that these measures would cost US households $2,000 this year alone.

TD Economics Analysis Recommendations Car prices rise About $3,000.

That’s because before the vehicle was assembled, the parts crossed the United States, Canada and Mexico bordered many times.

American consumers can also see a rise in prices for avocados, as Mexican avocados account for nearly 90% of the U.S. avocado market every year.

The Canadian billion-dollar maple syrup industry accounts for 75% of the entire global maple syrup production, so American households can also see the price of sweets rising.

“As far as consumers are concerned, you are more likely to raise prices in the short term because the company passes some of these prices to consumers,” Ella Hoxha, head of fixed income at Newton Investment Management, told the BBC.

Chris Torrens, vice president of the British Chamber of Commerce in China, added: “This is a huge challenge for the UK business due to the historical link between the UK and the US.

“But there is a real hope for stronger UK relations.”