39m ago10.04 BST

To no-one’s surprise, economic confidence across the eurozone has slumped this month.

The Sentix Investor Confidence Index has tumbled to -19.5 points, its lowest level since October 2023, down from -2.9 in March.

Sentix, the research group, explains that “Trump’s tariff hammer” has hammered optimism, with economic expectations for the eurozone now falling at a record pace.

The report adds:

US economic expectations fell to their lowest level since October 2008, while the tariff shock fuelled fears of a global recession.

The Euro Zone Sentix Index plummeted to -19.5 in April, a significant drop from -2.9 in March, far worse than the Reuters poll estimate of -10.0. #EuroZone 📉

— MiloX Trading (@CryptoMilox) April 7, 2025\n\n"}}" data-island-status="hydrated" style="box-sizing: border-box;">

45m ago09.58 BST

Gas prices are weakening today too, a sign that the markets are pricing in weaker economic growth and less demand for energy.

The month-ahead price of UK gas has fallen by 3.6%, to 85.5p per therm, the lowest since last September.

European gas prices fell more sharply; their benchmark futures fell as much as 8% on Monday after wiping out more more than 10% last week, Bloomberg reports, adding:

Fears that US President Donald Trump’s trade restrictions will slow down the economy have caused commodity prices to plummet, with traders expecting it could spell less demand for energy shipments.

54m ago09.49 BST

A Chinese foreign ministry spokesperson has warned that threats and pressure are not the right way to deal with China, after describing Donald Trump’s “reciprocal tariffs” as bullying.

Spokesperson Lin Jian told a press conference today that the tariffs are “typical unilateralism and protectionism, and economic bullying”, Reuters reports, adding:

“The abuse of tariffs by the United States is tantamount to depriving countries, especially those in the Global South, of their right to development.”

1h ago09.32 BST

Goldman Sachs: 45% risk of US recession in next year

Goldman Sachs has slashed its forecast for US economic growth this year, and warned there is a growing risk that America falls into recession in the next year.

Goldman has lowered its 2025 growth forecast from 1.0% to 0.5%, due to fears that Donald Trump will raise tariffs by much more than it had expected.

In a note titled “US Daily: Countdown to Recession”, Goldman also lifted its 12-month recession probability from 35% to 45%, following “a sharp tightening in financial conditions, foreign consumer boycotts, and a continued spike in policy uncertainty” following Trump’s tariff announcements.

Goldman analysts explain that they had expected the White House to announce a more aggressive tariff at first and then scale it back; instead, the new tariffs scheduled for 9 April would lift the effective tariff rate by more than expected.

They say:

First, financial conditions tightened more aggressively than we had expected in response to the White House’s announcement of its “reciprocal” tariff and the Chinese government’s announcement of its retaliatory tariffs on US exports.

This is partly because both announcements were more aggressive than expected. But it also suggests that the sensitivity of financial conditions to incremental tariffs is rebounding from the moderate levels of early 2025 toward the more outsized levels observed in the 2018-2019 trade war.

View image in fullscreen

 Photograph: Goldman Sachs

Second, our analysis of reduced foreign tourism to the US and foreign consumer boycotts suggests an additional 0.1-0.2pp hit to GDP growth in 2025. Our forecast had already assumed forceful retaliation by foreign governments, but we had not accounted for the effects of a consumer-led response.

Third, measures of policy uncertainty have spiked to levels far above those reached during the last trade war. The effects of policy uncertainty are likely to be much larger than in the first trade war because far more US companies are likely to be affected by uncertainty about the much larger and broader US and foreign tariffs this time, and some could also be affected by uncertainty about other policy areas, such as fiscal and immigration policy.

View image in fullscreen

 Photograph: Goldman Sachs

2h ago09.15 BST

Vix volatility index rising

Wall Street’s ‘fear index’ is surging higher again today.

The VIX index, which measures market volatility and uncertainty, has almost doubled today to around 60 points.

It’s at its highest level since last August, when US recession fears hit markets.

$VIX (market volatility index) is up 165% in the last five trading days 🫠💀 pic.twitter.com/FmNvybkMF8

— Philip Engberg (@philipengberg) April 7, 2025"}}" data-island-status="hydrated" style="box-sizing: border-box;">

[I initially thought it was the highest since March 2020, but it seems we’re not there yet….]

2h ago09.05 BST

Should you be worried about the falls on the market?

Hilary Osborne

Most people are investors through their pensions, even if not actively, so the sell-off could have an impact on their retirement funds. And even if they don’t have a pension, the sharp drop in share prices across the world could make a difference to their finances.

On Friday my colleague Hilary Osborne took a look at what the turmoil means for people in the UK - you’ll find it here:

What will stock market falls over Trump’s tariffs mean for UK pensions and savings?

2h ago09.04 BST

Helen Davidson

In Taiwan, stocks plummeted so fast on Monday that it triggered the 10% circuit breaker early in the morning, my colleagues Jason Tzu Kuan Lu and Helen Davidson report from Taipei.

The huge falls were driven by Taiwan tech giants TSMC and Foxconn.

Playing the stock market is hugely popular in Taiwan, with about 5.6m of Taiwan’s 24m people actively trading. Individual investors accounted for more than 55% of all transactions in June 2024, according to the Taiwan stock exchange. It means there are a lot of mum and dad investors out there, reeling from the global economic fallout.

At the Muzha market on the outskirts of Taipei, 65-year-old Mr T said he felt like the morning’s routing was an inevitable correction to market rises prior to Trump’s announcement. Monday was the first chance Taiwan’s market had to react to the 32% tariffs he put on the island, having been closed for a national holiday last Thursday and Friday.

“Before the holidays, the market was rising, so now it’s just a normal correction. But we can’t predict where the drop will stop,” he told the Guardian.

“What’s more concerning is the situation with TSMC’s poor performance in the U.S. When TSMC is struggling, everyone else is, too.”

Zhou Tzu-wei, a 34-year-old producer in Taiwan said he’d seen some “plummeting” of the market in the past “but nothing as bad as today”.

““Almost everything is dropped to the limitation of stock price (10%).It feels like the market just closed seconds after its opening. Even companies with factories in the U.S. took a hit. Only basic necessities like gas were less affected (and actually went up).”

Hou Dun-yi, a Taiwan-based actor, said he tried to clear his holdings before the open but “couldn’t sell a single share”.

“I don’t know if something like this has ever happened in the history of the Taiwan stock market. I’m not sure what will happen next, either. Trump is just too unpredictable. Anyway, I plan to sell all my stocks and take a break from trading. I’m going to read more books, do some research, and focus on living with the cash I have for now.”