U.S. President Donald Trump signs executive orders in the Oval Office of the White House on March 06, 2025 in Washington, DC. President Trump signed a series of executive orders, including lifting 25% tariffs for all goods compliant under USMCA trade agreement.
Alex Wong | Getty Images News | Getty Images
Global markets have been rocked by volatility in recent days, as investors try to stay ahead of U.S. President Donald Trump’s tariffs policies.
As the White House leader’s long-threatened levies on Canadian and Mexican goods finally came into effect this week, equity markets around the globe were shaken. Stocks on Wall Street sold off on Thursday, with sweeping losses hitting all major indexes and the Nasdaq Composite sliding into correction territory. European and Asian stocks have also seen choppy trade around Trump’s tariff announcements and policy rollbacks this year.
The volatility of Thursday took place even as Trump offered concessions to Canada and Mexico by way of delaying some of the levies until April 2.
Strategists told on Friday that investors should brace for further swings in markets arising from Trump’s trade policies, given the president’s apparent tendency to change tack.
“Volatility will stay with us,” Philippe Gijsels, chief strategy officer at BNP Paribas Fortis, told . “Headlines keep flowing and go in all possible directions. Besides the geopolitical uncertainty there is still the massive economic uncertainty with the U.S. clearly slowing… The situation in Ukraine — are we going to have a ceasefire or will things escalate? [Then there’s] tariffs, on which the ‘strategy’ changes every five minutes.”
‘Risk on risk off’ market environment
Jon Cunliffe, head of JM Finn’s investment office in London, agreed that volatility was on the rise with Trump back in the Oval Office — and the trend could be here to stay.
“During 2023 and the lead up to the election campaign, 100-day annualized volatility for the S&P 500 was as low as 10%, and we’re now heading up towards 15%,” he said over email. “Under Trump 2.0, it’s likely that this elevated level of volatility will continue, with the tendency to backtrack on policy initiatives creating a ‘risk on risk off’ market environment.”
Trump has so far pointed the finger at “globalists” for the latest market jitters, defending that the U.S. is “taking back things that have been taken from us many years ago.”
Yet analysts have previously warned the U.S. could also stand to suffer from Trump’s tariff plans, with American duties on imports likely to bleed into higher prices for U.S. consumers. Countries targeted by the levies have also taken or threatened punitive measures that could restrict their demand for U.S. exports. So far, Trump’s duties on Canadian and Mexican goods — which come in addition to new 20% U.S. tariffs on China and alongside threats from Trump to slap duties on goods from the EU — have prompted talk of retaliatory steps from Canada and Mexico’s leaders. China has also responded with its own tariffs aimed at U.S. goods, with officials warning they are willing to fight “any type of war” with America.
“Policy uncertainty and tariff news flow, which are combining to increase concerns about the U.S. growth picture and the prospect of a trade war, is likely to keep volatility elevated,” Thomas McGarrity, head of equities at RBC Wealth Management, told by email on Friday.
“Compounding this is that the U.S. assets are very well-owned, so the unwinding of extended position is also contributing to the weakness of U.S. stocks, following a period of exceptional returns over the past two years.”
An improving picture in Europe — particularly in light of a drive to reform fiscal policies and incentivize EU defense spending — was also playing into some rotation within equity markets, McGarrity said.
Asian, European markets tumble
Wall Street appeared calmer ahead of trading hours on Friday, with U.S. stock futures edging higher as investors awaited key jobs data out from the world’s largest economy. However, Asian and European markets both saw share prices tumble on Friday as regional investors digested the latest trade developments out of Washington.
“Don’t worry if you feel overwhelmed — you’re not alone,” analysts in Bank of America’s London office said in a note to clients on Friday morning, flagging that the “furious newsflow” of late had had this impact on investors.
“Clients we met on our marketing trip this week reported feeling overwhelmed by the rapid succession of high profile macro news,” they said. Both economic data signals — like the Atlanta Fed’s GDP tracker falling into negative territory — and the policy mix — including sweeping government job cuts and escalating trade tensions — were contributing to this, BofA’s analysts said.
— ‘s Kevin Breuninger, Brian Evans and Alex Harring contributed to this report.
