China and EU retaliate against tariffs as Trump says ‘great time to move companies to the US’ – business live​on April 9, 2025 at 2:48 pm

Trading in US stock market futures has been fairly choppy today, but after China’s retaliation it looks like selling on Wall Street is likely to resume on Wednesday.

The futures suggest that the S&P 500 is now on course for a 1.6% decline, the Nasdaq is set for a 1.3% drop, and the Dow Jones industrial average is set to drop 1.7%.

For comparison, at 9:44am BST the respective futures moves were -0.5% for the S&P 500, -0.2% for the Nasdaq, and -0.7% for the Dow Jones industrial average.

US borrowing costs have risen in the wake of China’s tariff retaliation.

The yield on the benchmark 10-year US Treasury rose above 4.42% ahead of New York’s markets opening, up 0.12 percentage points over the course of the day – although short of the peak above 4.51% earlier on Wednesday. Bond yields move inversely to prices, so rising yields indicate selling.

The yield on the US 30-year Treasury also rose above 4.9%, although that was also short of the heights of 5.02% earlier.

It is not just stock markets that have been rocked by China’s retailiation to Donald Trump’s tariffs: oil prices immediately plunged further.

Brent crude oil futures prices dropped as low as $58.47, as shown in the below chart. Bear in mind that this was the first time that a barrel had cost less than $60 since February 2021.

That has left Brent crude prices down by 5.1% today, while the price of West Texas Intermediate is down 5.4% to $56.37.

China’s announcement repeats its description of Trump’s 104% tariffs as a mistake on top of a mistake”.

It will respond with 84% tariffs on US imports from Thursday 10 April. That is an increase from the previous rate of 34%.

It said the US decision “seriously infringes on China’s legitimate rights and interests and seriously damages the rules-based multilateral trading system”, according to a translation of the announcement by Google Translate.

Stock markets have slumped further after China’s announcement of retaliatory tariffs of 84% on US imports.

The FTSE 100 is now down 3.4%. The Stoxx 600 index, which tracks the biggest European companies, is now down 4.2%.

Germany’s Dax has fallen 3.4% today, while France’s Cac 40 has dropped 3.4%.

China has announced new tariffs of 84% on the US, in a response to Donald Trump’s trade war that will raise fears of further escalation.

The Chinese ministry of finance said it will impose 84% tariffs on US goods from Thursday, up from the 34% previously announced, according to Reuters.

Stock markets sold off further in the wake of the announcement. More details to follow.

Donald Trump’s sweeping tariffs have put global growth at risk, the Bank of England has warned, heaping pressure on government finances and increasing the likelihood of “severe shocks” to the financial system.

The Bank’s financial policy committee (FPC) said its global risk environment had deteriorated and “uncertainty had intensified” since its last update in November, with US tariff announcements contributing to a “material increase in risks to global growth” and inflation levels.

Those concerns have knocked investor confidence, and increased the risk of a “further sharp correction” in financial markets that could cause stress for indebted companies and make it harder for governments to borrow money and refinance their debts.

The Bank warned that higher government bond yields – effectively the interest rate countries pay on their debt – would “reduce their capacity to respond to future shocks”. Government bonds, including the traditionally safe haven US treasuries, have been undergoing a dramatic sell-off since Trump announced a fresh wave of tariffs on dozens of countries overnight.

You can read the full report from the Guardian’s banking correspondent, Kalyeena Makortoff, here:

Oil prices are also slumping, as investors price in the risk of a global recession prompted by Donald Trump’s tariffs.

Brent crude oil futures prices fell by more than 4% on Wednesday, dipping below the $60 per barrel mark for the first time since February 2021. That was a decline from $75 at the start of the month.

West Texas Intermediate, the North American benchmark, also dropped by 4% to $57.

Falling oil prices are one aspect of the market turmoil that Donald Trump will welcome, as he promised cheaper energy and gasoline for cars. However, it is not clear that he planned to achieve that goal by raising the risk of a global recession.

It is also tricky to see how falling oil prices can be squared with Trump’s ambition to raise US oil production beyond record levels under Joe Biden.

Checking back in on stock markets as we approach midday: the FTSE 100 is back down by 3% today – firmly in “oof” territory.

The German Dax index is down by 3.1%, while France’s Cac 40 is down 3.1%. Italy and Spain’s benchmarks have fallen 2.9% and 2.6% respectively.

Switzerland’s SMI – with large contributions from its under-pressure pharma giants – has slumped 4.5%.

The Bank of England’s assessment of global financial risks is dominated by Donald Trump’s tariffs. It reads as a litany of warnings about increased risks to economic and financial stability.

The UK is particularly at risk from global instability because it is a small, open economy, the Bank said.

However, the British banking system is “well capitalised” to withstand any turmoil, the Bank said.

Here are some more choice excerpts:

• “The global risk environment has deteriorated, and uncertainty has intensified. A range of risky asset prices, led by those denominated in US dollars, have declined sharply. The probability of adverse events, and the potential severity of their impact, has risen.”

• Several risks associated with the fragmentation of global trade in goods, and financial markets, have intensified” but a “major shift in the nature and predictability of global trading arrangements could harm financial stability by depressing growth”.

• “Geopolitical tensions, and risks associated with sovereign debt pressures globally, had also risen.”

The Bank of England has warned that Donald Trump’s tariffs will raise risks to global growth and higher inflation.

In the record of the last meeting of its financial policy committee, led by governor Andrew Bailey, the Bank said that there was also a risk that the tariffs could worsen financial market shocks.

On the direct impacts of Trump’s tariffs, the Bank said:

This had contributed to a material increase in the risks to global growth and a weakening of the central outlook, as well as increased uncertainty over the outlook for inflation globally.

But the committee, which is set up to look for risk to financial market stability, also highlighted that risks have increased. It said:

Heightened global uncertainty and perceived higher economic risk could translate into tightened financing conditions for business, as well as impacting exit opportunities for investors in an already subdued IPO market. Such developments had the potential to interact with the vulnerabilities identified by the FPC around high leverage, valuations uncertainty, credit market interconnections and the exposure of insurers. In addition, these vulnerabilities could amplify shocks to highly indebted UK corporates or investor confidence and potentially affect UK financial stability.

Ireland’s economy would also be in the crosshairs if pharmaceuticals are hit by tariffs.

Just across the bay from the historic town of Cobh, the last port of call for the Titanic in 1912 on her ill-fated maiden voyage, lies the source of some of the world’s biggest life-savers and givers.

Sildenafil, the active ingredient in Viagra, medicinal compounds for the treatment of cancer, rheumatoid arthritis, psoriasis, Crohn’s and Parkinson’s disease, all are manufactured within two miles of the deep port of Ringaskiddy in County Cork.

On the main road from Ringaskiddy to Carrigaline, on the back road to Curraghbinny, or down towards the white beaches of Lough Beg, the mammoth windowless plants of Pfizer, Johnson & Johnson and their private wind turbines are the main attractions.

After more than 50 years, however, it is all under threat after Donald Trump accused Ireland of stealing America’s pharmaceutical industry and vowed to “force” US companies, jobs and taxes to return home.

You can read the full report here:

Donald Trump’s threat to impose tariffs on pharmaceuticals has rattled investors on Wednesday. Medicines are exempt from tariff round that started today – and have been exempt for 30 years under World Trade Organization rules.

Most governments do not want to make potentially life-saving medicines more expensive. But Donald Trump said he believes tariffs will push drugmakers to move production to the US.

Switzerland’s Roche fell 5.7%, while rival Novartis dropped 6.1%, and AstraZeneca and GSK fell to the bottom of the FTSE 100 performers on Wednesday, down 5.3% and 4.7% respectively. France’s Sanofi was down 5.3% and Germany’s Bayer down 2.3%.

Even Novo Nordisk, which has become one of the world’s biggest companies thanks to the success of weight loss drug Ozempic, has not been exempt from the chaos. Its Copenhagen-listed shares are down 4.2%.

(Thankfully for Ozempic’s millions of American users, whose insurers already have to pay thousands of dollars a year, Novo already has a factory for the injections in North Carolina.)