Dow Jones tumbles 1,000 points, Nikkei 225 drops over 4%: Why are global markets falling?

The US stocks ended in red, while the Asian stocks are trading in the negative territory as the tensions between the US and China escalate, even after President Donald Trump has paused tariffs on most nations for 90 days.

The Dow Jones Industrial Average settled 1,014 points or 2.5% lower, and the Nasdaq Composite is down 4.31%. The S&P 500 closed 3.46% down, a day after surging a historic 9.5%.

Following a similar trend, Asian markets also fell. Japan's Nikkei 225 slid 4.51%, while Singapore's Straits Times fell 2.2%. Hong Kong's Hang Seng index was trading 0.37% lower, and South Korea's KOSPI plunged 1.58%.

Why are markets falling?

The decline in global indices comes after the White House clarified on Thursday that Chinese goods will face 145%, including the previous tariffs announced by Trump.

Meantime, China has started reaching out to other nations to form a united front against America.

Xiao Qian, China's ambassador to Australia, stated that joint resistance is the sole way to fight the US' "hegemonic and bullying behavior."

However, Australian Prime Minister Anthony Albanese made it clear that his country will prioritise its national interest and not align with China's stance.

Meanwhile, Trump has paused additional tariffs on most trading partners, including India, until July 9.

"Effective with respect to goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. eastern daylight time on April 10, 2025, enforcement of the second paragraph of section 3(a) of Executive Order 14257 is suspended until 12:01 a.m. eastern daylight time on July 9, 2025," the order said.

Notably, the 10% baseline tariff on the nations will continue to remain in place.

GIFT NIFTY suggests positive start

GIFT NIFTY suggested a gap-up opening for the Indian stock markets. At 7:35 am, it is up 2% to 22,950, reflecting a positive start for NIFTY and SENSEX.