Global stock markets fall, gold prices hit new record high as US announces reciprocal tariffs; Here's all you need to know

GIFT NIFTY futures traded 265 points lower at 23,165 on Thursday morning, indicating a big gap down for Indian markets on Thursday. The US futures, too, traded more than 1% lower on Thursday morning, reacting to the aftermath of imposing reciprocal tariffs on all trading partners except for Canada and Mexico. The Asian markets also traded with deep cuts across the board.

US President Donald Trump announced reciprocal tariffs on trading partners with as high as 49% on some countries like Cambodia, Vietnam, etc. The US imposed reciprocal tariffs of 34% on China, 26% on India, 24% on Japan, European Union 20% and UK at 10%. Brazil and the UK were the lowest on the list. With the tariffs, the US kitty is expected to get richer by $600 billion per year. However, experts and analysts see inflation rising due to the higher cost of imported goods.

Following the announcements, gold prices hit a new high of $3,167 per ounce as investors piled up for safe haven investments amid market turmoil. The US 10Y yield fell 1.2% to 6-month lows of 4%, indicating poor confidence in the treasuries and lowering the outlook of US economic growth. Similarly, the dollar index also fell to six-month lows to 103 levels.

US markets

The US markets closed in green on Wednesday night with gains of up to 0.8%. The Dow Jones, S&P 500 closed with 0.6% gains, and NASDAQ closed with 0.87%. However, the US stock futures are now traded lower on Thursday morning reacting to tariff announcements.

Asian markets

The Japanese, Korean and Chinese markets tumble on reciprocal tariff announcements. The Japanese indices dropped 3% or 1,090 points as the reciprocal tariffs stood at 24%. Similarly, Chinese and Hong Kong indices also fell more than 1% on 34% tariffs imposition. The Japanese yen strengthened further as the dollar index weakened on the announcement of tariffs.

Crude oil

The crude oil prices fell 3% after higher than expected tariffs are expected to have an economic fallout and slump in demand. Although the oil and energy products were exempted from the list, the sweeping tariffs of 34% on China, 20% on the EU are expected to increase uncertainty at the global level. WTI crude oil prices fell below $70 per barrel, and Brent Crude oil prices hovered around $73 per barrel.

FII and DII data

The FIIs continued to sell for the third consecutive day on Wednesday as uncertainty rose on tariff announcements as they sold equities worth ₹1,500 crore. However, in derivatives markets, the FII position remains light with 62 thousand contracts on the short side, slightly lower from Tuesday. On the other hand, the DIIs bought equities worth ₹2,808 crore.