Trump's 'Reciprocal Tariff' Plan Hits Market Confidence As Dow Futures Drops Over 830 Points

U.S. stock futures plunged on Wednesday after President Donald Trump unveiled broad new tariffs on key trading partners, sparking fears of a global trade war that could further weaken the U.S. economy.

What Happened: Futures on the S&P 500 plunged 2.7% to 5,557.75, while Nasdaq-100 futures tumbled 3.37% to 19,092.25 in after-hours trading. Dow Jones Industrial Average futures fell 1.95% to 41,665.00, erasing nearly 830 points.

Trump unveiled a “reciprocal tariff rate” set at 50% of what trading partners charge the United States, including non-tariff barriers like currency manipulation and value-added taxes.

“April 2nd, 2025 will forever be remembered as the day American industry was reborn,” Trump said, calling the move “our Declaration of Economic Independence.”

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Why It Matters: The “Magnificent Seven” tech stocks bore the brunt of the sell-off, projected to lose a combined $685 billion in market value. Apple Inc. ( AAPL ) led declines in after-hours trading, dropping 7.14% and facing a potential $221.7 billion market cap loss. NVIDIA Corp. ( NVDA ) fell 5.68%, while Amazon.com Inc. ( AMZN ) declined 6.10%.

Leading economists expressed alarm, with Justin Wolfers calling the tariffs “monstrously destructive” and former Treasury Secretary Larry Summers estimating potential economic losses of up to $20 trillion, or well over $200,000 per family of four.

While Canada and Mexico were notably excluded from the tariff program, Vietnam, Cambodia, and Sri Lanka face the steepest increases under the new system. As investors sought safety, gold futures gained 1.1%, with economist Peter Schiff predicting prices could reach $3,500 this month.

Read Next:

• ‘Dr. Doom' Nouriel Roubini: Trump's ‘Liberation Day' Tariff Label Is Orwellian Doublespeak, US ‘Playing With Fire'

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.