U.S. stocks plunged in after-hours trading on Wednesday following President Donald Trump’s announcement of sweeping tariffs starting at 10%—with significantly higher rates for targeted countries. Within minutes, futures tracking the S&P 500 fell 2%, while the Nasdaq tumbled 3%, marking the most severe drop since the onset of the pandemic.
The sharp sell-off came after Trump accused foreign nations of “ripping off” the United States and vowed to impose tariffs on imports worldwide. The measures were harsher than anticipated, sparking fears on Wall Street that the policy would stifle economic growth, fuel inflation, and disrupt global markets.
Most Americans’ retirement savings, including 401(k) plans, are tied to stock market performance. As futures on the S&P 500, Nasdaq-100, and Dow Jones slumped 2.3%, 4.2%, and 2.3% respectively, the value of retirement funds faced immediate risks.
Major importers were hit hard, with Nike falling 6% and General Motors down 3%. Already struggling companies, such as Nvidia and Tesla, shed about 3%, while retail chains like Five Below and Gap tumbled 11% and 12%.
Though Wall Street’s main trading session ends at 4 p.m. in New York, after-hours trading extends until 8 p.m., allowing investors to react swiftly to breaking news. Futures contracts, which track key indexes like the S&P 500, Nasdaq, and Dow, as well as commodities like gold, are traded around the clock, except for a one-hour break starting at 5 p.m.
If stock prices fail to recover, Americans could face significant losses when markets reopen at 9:30 a.m. on Thursday.
President Trump declared the tariffs a “declaration of economic independence,” announcing a baseline 10% duty on all imports effective April 5, with higher rates on nations imposing steep duties on U.S. goods. From midnight in Washington, a 25% tariff would be applied to all foreign cars imported into the U.S.
Displaying a chart during his speech, Trump outlined the U.S.’s planned tariffs: 34% on China, 20% on the European Union, 25% on South Korea, 24% on Japan, and 32% on Taiwan. Vietnam was singled out for a 46% tariff, while India was set to face a 26% duty despite Prime Minister Narendra Modi being described as a “great friend.”
Lesotho faced the highest tariff at 50%, while Canada and Mexico were exempt, thanks to existing trade agreements. Trump emphasized that the policy was necessary to address decades of exploitation by foreign nations.
Critics fear the tariffs could backfire, triggering a global trade war, driving up consumer prices, and destabilizing markets. Nevertheless, Trump promised that factory jobs would return to the U.S., even if consumers faced temporary pain.
Stocks, which had risen earlier in the day, reversed course as Trump delivered a fiery tirade against foreign “cheaters” who “ransacked” American factories. “For nations that treat us badly, we will calculate the combined rate of all their tariffs, non-monetary barriers, and other forms of cheating,” he said, vowing to impose rates “approximately half of what they charge us.”
As markets brace for further volatility, Trump’s tariffs signal a high-stakes gamble that could reshape the global economic landscape—whether for better or worse remains uncertain.
