Stocks Plunge After Trump Unveils Sweeping Tariffs on Nearly Every U.S. Trading Partner

NEW YORK, April 3 - U.S. stocks fell sharply on Thursday, with the S&P 500 down about 4.8 percent and the Dow Jones industrial average losing more than 1,600 points, a day after President Trump announced the broadest set of import taxes in modern American history.

Speaking from the White House Rose Garden on Wednesday afternoon, Trump called it "Liberation Day" and said the tariffs would restore American manufacturing. A 10 percent baseline tariff applies to nearly all imports starting this weekend. Higher country specific rates, which the administration calls "reciprocal," take effect April 9. They include 34 percent on goods from China, 20 percent on the European Union, 24 percent on Japan, and 46 percent on Vietnam.

Canada and Mexico were not included in the new country by country list, but existing tariffs on those countries remain in place.

How the numbers were set: Analysts who tried to reverse engineer the rates found they appeared to be based on each country's trade deficit with the United States divided by its exports to the U.S., rather than on the actual tariffs those countries charge. Economists say that method is unusual, and some say it puts high tariffs on small economies with little to gain from selling to the U.S.

What happens next: Companies that rely on imported parts, including carmakers, retailers, and electronics firms, said they are reviewing their pricing. Shares of Nike and Apple fell sharply in early trading. The administration also announced a 25 percent tariff on imported cars and car parts. Tariffs are paid by U.S. importers, which typically pass some of the cost to consumers.

Other governments are weighing their response. European Commission President Ursula von der Leyen said the EU is ready for "firm countermeasures if necessary." China vowed countermeasures.

It is the worst day for U.S. stocks since 2020.

The administration says the plan will bring manufacturing back to the United States. Consumers and businesses will find out within weeks how much of the cost lands on them.