By John Meyer, consultant in financial affairs – Eurasia Business News, August 1, 2025. Article no. 1673
U.S. stock markets experienced sharp declines on Friday, August 1, 2025, as investors reacted to a wave of new tariffs unveiled by President Trump and further disappointment from a much-anticipated jobs report.
Tariff Blitz: President Trump announced sweeping tariff increases on nearly all major U.S. trading partners, with some rates—such as tariffs on Canadian goods—rising immediately from 25% to 35%. Tariffs on other countries are set to range from 15% to 40%, taking effect on August 7, while leaving a brief window for last-minute negotiations. This aggressive move has heightened fears over global trade disruptions and their impact on U.S. business costs and corporate profits.
Trading partners, including Switzerland and Taiwan, said they would keep trying to negotiate with the White House. Switzerland faces a 39% tariff rate—higher than the 31% floated in April—while Taiwanese goods will be levied at a 20% rate.
The president hiked levies on Canadian goods that don’t comply with a North American trade agreement to 35%, starting today. Prime Minister Mark Carney said that he was disappointed, but the country doesn’t appear eager to retaliate.
U.S. trade talks with Canada have involved the level of aluminum tariffs as some U.S. manufacturers, most notably Ford Motor, are dealing with a financial hit, according to Treasury Secretary Scott Bessent.
Market Reaction:
The Dow Jones Industrial Average plunged 542 points (1.2%) to close at 43,588.58.
The S&P 500 dropped 101 points (1.6%) to finish at 6,213.05.
The Nasdaq also suffered steep losses amid a broader sell-off, driven in part by disappointing quarterly results from Amazon and other technology heavyweights.
Broader Sentiment: Wall Street’s selloff was intensified by the release of the July jobs report, which showed weaker-than-expected hiring and a rise in unemployment. The labor market softness, along with the looming impact of tariffs, led to growing uncertainty over the economic outlook and the Federal Reserve’s next move on interest rates. U.S. added just 73,000 jobs last month, Bureau of Labor Statistics reported Friday.
Additional Market Notes
Technology shares were mostly lower, with Amazon stock falling 8% following a disappointing earnings report, while Apple bucked the trend, gaining 2% on stronger-than-expected iPhone sales.
The dollar sank, while Treasury yields dropped and the Dow industrials shed more than 1.2%, or 542 points. The VIX, a market-volatility index often dubbed a fear gauge, shot higher. After the report, investors ramped up bets that the Federal Reserve will now be more inclined to cut rates to support the economy.
The yield on the 10-year Treasury note rose to 4.40%, reflecting increased uncertainty and a flight to safety by investors. The U.S. dollar strengthened modestly, and gold prices remained steady as investors weighed inflation risks as well as economic weakness.
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The market’s reaction was mirrored globally, with international equity indexes also lower as the U.S. trade actions reverberated across the world economy.
European stocks skidded, with Italian, French and German indexes down more than 2.5%.
Asian indexes declined too. South Korea’s Kospi slid 3.9% after Seoul proposed higher taxes on corporations and investors.
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The combination of new tariffs, a soft jobs report, and disappointing tech earnings culminated in significant declines for all major U.S. stock indexes, further shaking investor confidence and adding new risks to the economic outlook.
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© Copyright 2025 – Eurasia Business News. Article no. 1673
Eurasia Business News 