Stocks Stall on Tariff Concerns as Dollar Weakens: Global Market Analysis

By: Aditi

Published on: Apr 24, 2025

The global equity rally that dominated headlines earlier this week lost momentum on Thursday, April 24, 2025, as investors grappled with renewed uncertainty surrounding the US-China tariff dispute. Markets reversed course after US Treasury Secretary Scott Bessent tempered optimism about a swift resolution to the trade war, while China reiterated demands for the removal of all unilateral tariffs. The dollar weakened against haven currencies like the Swiss franc and Japanese yen, while Treasury yields dipped as traders sought safety.

Key Market Movements Highlight Investor Anxiety

The S&P 500 futures fell 0.4%, Nasdaq 100 futures dropped 0.5%, and Dow Jones Industrial Average futures slid 0.5% in premarket trading. European equities pared losses but remained subdued, with the Stoxx Europe 600 down 0.1%. Asian markets snapped a five-day winning streak, reflecting growing skepticism about progress in trade negotiations.

The Bloomberg Dollar Spot Index fell 0.4%, its steepest decline in two weeks, as investors shifted toward safer assets. Gold prices surged 1.3% to $3,330.67 per ounce, underscoring the flight to stability. Meanwhile, the yen strengthened 0.8% against the dollar, and Treasury yields slipped, with the 10-year note dropping four basis points to 4.34%.

Tariff Uncertainty Fuels Market Volatility

Investor sentiment soured after conflicting signals from US and Chinese officials. Treasury Secretary Bessent cautioned that a comprehensive trade deal could take two to three years, dampening hopes for an imminent agreement. His remarks followed President Donald Trump’s earlier suggestion that revised tariff rates might emerge within weeks. Beijing, however, rejected partial negotiations, demanding a full revocation of tariffs and “sincerity” from Washington.

“The narrative from the White House is all over the place,” said Peter Kinsella, head of FX strategy at Union Bancaire Privee Ubp SA. “Markets are struggling to price in erratic policy shifts, making it nearly impossible to trade with conviction.”

The tariff stalemate has already impacted corporate earnings. Deutsche Bank AG strategists slashed their 2025 S&P 500 earnings-per-share forecast by 15%, citing disproportionate harm to US companies. Their revised year-end target of 6,150 for the index implies a 14% upside from current levels but reflects a slower recovery from February’s peak.

Earnings Reports Reflect Trade War Strain

Corporate earnings underscored the tariff fallout. International Business Machines Corp. (IBM) tumbled 8% in premarket trading after missing revenue expectations, driven by weaker demand in China and supply chain disruptions. In Europe, BNP Paribas SA slid 3% as net income dropped amid rising loan defaults linked to global trade tensions.

Not all results were grim. Consumer goods giant Unilever Plc gained 2.5% after beating sales estimates, highlighting resilience in essential sectors. However, the mixed earnings landscape reinforced concerns about prolonged trade disputes denting profitability.

The Dollar’s Decline and Haven Demand

The dollar’s weakness contrasted with gains in traditional safe havens. Analysts attribute the greenback’s slump to fears that aggressive tariff policies could undermine US economic growth. Meanwhile, the euro climbed 0.6% to 1.1388,andtheBritishpoundrose0.51.1388,andtheBritishpoundrose0.51.3315, benefiting from improved risk sentiment in Europe.

“The dollar’s retreat signals broader anxiety about unpredictable US policies,” noted Francois Antomarchi, a portfolio manager at Degroof Petercam. “While geopolitical risks may have peaked, markets remain vulnerable to sudden shifts in rhetoric.”

Commodities and Cryptocurrencies React

Oil prices edged higher, with West Texas Intermediate crude rising 0.8% to 62.78abarrel,supportedbysupplyconcernsamidMiddleEasttensions.Cryptocurrenciesfacedheadwinds,withBitcoinfalling1.262.78abarrel,supportedbysupplyconcernsamidMiddleEasttensions.Cryptocurrenciesfacedheadwinds,withBitcoinfalling1.292,594 and Ether dropping 2.7% to $1,747.48 as investors prioritized liquidity.

What’s Next for Investors?

1. Trade Negotiation Timelines: Markets will scrutinize any signals of progress ahead of the speculated 2–3-week window for revised tariffs. A breakdown in talks could trigger renewed volatility.


2. Federal Reserve Policy: While the Fed has paused rate hikes, inflationary pressures from tariffs may force a reassessment.


3. Corporate Guidance: Upcoming earnings reports will reveal how companies are adapting to supply chain disruptions and cost pressures.

Strategic Takeaways for Traders

• Diversify into Defensive Assets: Gold and Treasury bonds are likely to remain buoyant as tariff risks persist.


• Monitor Currency Pairs: The yen and Swiss franc could extend gains if trade tensions escalate.


• Focus on Resilient Sectors: Consumer staples and utilities may outperform cyclical stocks in a volatile environment.

Conclusion: Navigating a Fragile Market Landscape

The stall in equity markets underscores the fragility of investor confidence amid escalating trade rhetoric. While hopes for a resolution linger, the lack of clarity from policymakers suggests turbulence will persist. For now, traders must balance short-term opportunities with long-term defensive strategies to navigate this uncertain terrain.