Stock market drops again after brief rise as Trump remains committed to

Stocks are sharply swinging down, up, then down again on Wall Street as markets try to assess the potential damage from U.S. President Donald Trump’s global trade war.

The Dow Jones Industrial Average briefly erased a morning loss of 1,700 points, shot up more than 800 points, then went back to a loss of 414 points. The S&P 500, likewise, made sudden up-and-down lurching movements and was down 1.3 per cent in the first hour of trading.

The Nasdaq composite was down 0.8 per cent. That followed sharp drops around the world as worries rise about whether Trump’s trade war will torpedo the global economy.

Wall Street’s main indexes reversed course and moved sharply higher after White House economic adviser Kevin Hassett said in an interview that Trump was considering a 90-day tariff pause on all countries except China. The markets fell again as the White House called word of a 90-day pause “fake news.”

Wall Street opened down today, coming off its worst week since COVID began crashing the global economy in March 2020. 

Before trading began, the S&P 500 was headed toward bear market territory, defined as a fall of more than 20 per cent from the peak. The S&P 500, Nasdaq and Dow Jones all recouped some value before markets opened. The index was off 17.4 per cent as of the end of last week. 

The massive sell-off in riskier assets that began the day and roiled global stock markets follows Trump’s announcement of sharply higher U.S. import taxes and retaliation from China that saw markets fall sharply Thursday and Friday. 

Late Sunday, Trump reiterated his resolve, saying, “sometimes you have to take medicine to fix something.” 

Some countries, South Korea and Pakistan among them, said they were sending trade officials to Washington soon to try to seek clarity.

However, Germany’s economy minister, Robert Habeck, was defiant as he arrived at a meeting of European Union trade ministers in Luxembourg, saying the premise of the wide-ranging tariffs was “nonsense” and that attempts by individual countries to win exemptions haven’t worked in the past. 

It’s important for the EU to stick together, he said. That “means being clear that we are in a strong position — America is in a position of weakness.”

Trump has justified the tariffs as a matter of addressing American trade deficits — which most economists say is not a sign of economic health in and of itself. In the case of Canada and Mexico, he has sought to use tariffs to try to curb the flow of fentanyl into the U.S., even though drug interdictions from Canada into the U.S. are relatively low.

JPMorgan Chase CEO Jamie Dimon, in his much-read annual note to shareholders early Monday, cautioned investors…