The Nikkei plunge nears 9% as Japanese bank stocks plummet. Japan’s Nikkei share average tumbled nearly 9% early on Monday, while an index of Japanese bank stocks plunged as much as 17%, as concerns over a tariff-induced global recession continue to rip through markets.
The Nikkei dropped as much as 8.8% to hit 30,792.74 for the first time since October 2023. The index was trading down 7.3% at 31,318.79, as of 0034 GMT, Reuters reports. All 225 component stocks of the index were trading in the red.
The broader Topix sank 8% to 2,284.69. A topix index of banking shares slumped as much as 17.3%, and was last down 13.2%. The bank index has borne the brunt of the sell-off in Japanese equities, plunging as much as 30% over the past three sessions.
Hong Kong and Chinese stocks dive
Hong Kong stocks have plummeted more than 9% at open, while Singapore stocks dropped over 7%, according to reports.
Hong Kong and Chinese stocks dived on Monday as markets around the world crumbled in the face of the widening global trade war and fears it will unleash a deep recession, Reuters says. Hong Kong’s Hang Seng index was down 8% in early trade. Shares in online giants Alibaba and Tencent were down more than 8%.
China’s CSI300 blue-chip index fell 4.5%. China, which is now facing US tariffs of more than 50%, responded in kind on Friday by slapping extra levies on US imports.
US Treasury yields fell on Monday and the two-year yield sank to a multi-year low as worries of a possible recession in the world’s largest economy grew and investors wagered that could see US rates cut as early as May. The two-year US Treasury yield, which typically reflects near-term rate expectations, tumbled more than 20 basis points to its lowest level since September 2022 at 3.4350%, as investors ramped up bets of more aggressive Federal Reserve easing this year, Reuters reports. The benchmark 10-year yield last stood at 3.9158%, languishing near Friday’s six-month low of 3.8600%
Futures now point to nearly 120 basis points’ worth of Fed cuts by December and markets swung to imply a roughly 60% chance the US central bank could ease rates in May, as policymakers seek to shore up growth in the world’s largest economy on the back of President Donald Trump’s latest tariff salvo.
JPMorgan ratcheted up its odds for a U.S. and global recession to 60%, as mentioned, and brokerages elsewhere similarly raised their probability of a US recession as tariff distress threatens to sap business confidence and slow global growth.
The market carnage came as White House officials showed no sign of backing away from their sweeping tariff plans, Reuters reports, and China declared the markets had spoken on their retaliation through levies on US goods.
Donald Trump says foreign governments will have to pay “a lot of money” to lift the sweeping tariffs he has characterised as “medicine” and which have routed Asian share markets.

Financial markets were hit by another wave of selling on Sunday evening, with investors and economists grappling with rising odds of a severe economic downturn caused by President Trump’s significant new tariffs on imports.
Futures on the S&P 500, which allow investors to bet on the index before the official start of trading on Monday, dropped roughly 4 percent on Sunday evening. In oil markets, which also open for trading on Sunday evening, prices fell more than 3 percent — adding to steep losses last week. And the price of copper, considered a broad economic indicator, slid more than 5 percent. The 10.5 percent drop in the S&P 500 on Thursday and Friday was the worst two-day decline for the index since the onset of the coronavirus pandemic in 2020.
The only other instances of a worse two-day drop came during the 2008 financial crisis and the 1987 stock market crash, according Howard Silverblatt, senior index analyst at S&P Dow Jones Indices. In dollar terms, the more than $5 trillion that was wiped out in the S&P’s value in the two days last week stands unmatched.
Even more unusual is that last week’s sell-off stemmed directly from presidential policy. Mr. Trump has so far brushed off concerns about the market reaction and potential economic consequences, showing little intention of backing down. “If they’re maintained, the tariff hikes announced April 2 represent a self-inflicted economic catastrophe for the United States,” Preston Caldwell, senior US economist for Morningstar Research Services, said in a blog post on Friday.
Chief executives have begun warning consumers that they should expect prices to increase on some groceries, clothes and other products. Consumers have said they intend to rein in spending on big-ticket items. Some auto companies have already announced production pauses overseas, as well as job losses domestically. Bank economists have raised the odds that a recession will hit the United States over the next 12 months. As countries responded last week with tariffs of their own, the sell-off in financial markets accelerated.
The S&P 500 is now 17.4 percent below its peak reached in February, on course to enter a bear market, defined as a drop of 20 percent or more from a recent peak. The Nasdaq Composite index, which is chock-full of tech stocks that came under pressure as the sell-off accelerated last week, is already in a bear market, down almost 23 percent from its December peak. The Russell 2000 index of smaller companies that are more sensitive to the outlook for the economy has fallen over 25 percent from its November peak.
Scott Bessent, the Treasury secretary, said on Sunday on the NBC program “Meet The Press” that he saw “no reason” to expect a recession.

There was little rest on Wall Street this weekend. There was plenty of anger, anxiety, frustration, and fear.
Anger at President Trump for a brash and chaotic rollout of tariffs that erased trillions of dollars in value from the stock market in two days. Anxiety about the state of the private equity industry and other colossal funds with global investments. Frustration among Wall Street’s elite at their sudden inability to influence the president and his advisers.
And fear of what may come next. Major banks played out emergency scenarios to guess whether one client or another would fail in the cascading effects of an international trade war.
In conversations with The New York Times over the weekend, bankers, executives and traders said they felt flashbacks to the 2007-8 global financial crisis, one that took down a number of Wall Street’s giants. Leaving out the brutal, but relatively short-lived market panic that erupted at the start of the coronavirus pandemic, the velocity of last week’s market decline — stocks fell 10 percent over just two days — was topped only by the waves of selling that came as Lehman Brothers collapsed in 2008.
Like then, the breadth of the sudden downdraft — with oil, copper, gold, cryptocurrencies and even the dollar caught up in the sell-off — has Wall Street’s biggest players wondering which of their competitors and counterparties was caught off guard. Banks have asked trading clients to post additional funds if they want to continue borrowing money to trade — so-called margin calls that haven’t nearly reached the level of a generation earlier but are nonetheless causing unease.
“It definitely feels similar to 2008,” said Ran Zhou, a New York hedge fund manager at Electron Capital, who canceled weekend plans and put on a button-up shirt to sit in his Manhattan office and read Chinese news sources to get the jump on China’s plans.
There were some bright spots. Several bank and hedge fund executives pointed out that, despite the frenzied selling, trading in the wake of the tariff announcement had so far proceeded without any unexpected glitches, a point that Mr. Bessent also made on Sunday. A senior executive at one major bank also said there was relief after a call on Friday night with the bank’s regional heads and top executives that nobody could point to a specific client in danger of immediate implosion.
The true depth of the impact is yet to be determined. Bank of America estimates that profits for companies in the S&P 500 may fall by one-third if retaliatory levies are enacted by the countries subject to Mr. Trump’s tariffs. But the dire assessments could change, if countries begin to strike agreements with the White House that will lower the tariffs.
Two private equity executives said they expected that market turmoil and souring global relations would make it more difficult for private firms like theirs to raise money, adding to the challenges they are already facing as a dwindling deals market has made it harder to return cash to their investors. Pressures on those firms will only increase as the businesses they invest in begin to feel the impact of tariffs, these executives said. Shares of Apollo and KKR fell more than 20 percent on Thursday and Friday.
One prominent deals lawyer described himself as “flabbergasted” as he grappled with how far the share prices of his clients had fallen. A top Goldman Sachs executive summed up the frustration with Mr. Trump succinctly: Someone has to stop him.
Steve Eisman, the investor made famous in “The Big Short” for having foreseen the 2007-8 housing market collapse, said some humility was in order: “Everybody in the stock market went to college and everyone who went to college took Econ 101 and had it drummed into their heads that trade wars are bad,” Mr. Eisman said on Saturday. He suggested that investors were ignoring the potential that the United States, thanks to its economic strength, may be the best positioned of any nation to prosper in such scenarios.

@linter, thanks for your research and post, providing conclusive evidence of what most of us already knew, Teched1000 is a fraud.
His reply, with two links to nowhere (sic) and his rambling psycho-babble post about general investment BS and references back to 2020 and 2022 (Say what?) are testament to it. You don't have to have 35+ years of audit experience to know that 500+ word responses about everything but the simple question that was posed/issue that was raised indicate, well, in technical accounting terms, bullshit.

Apple is nearly 6% down today, after falling 9% on Thursday – what amounted to over $300bn of its market value, according to the Financial Times. It was the company’s worst day since March 2020, at the beginning of the Covid-19 pandemic. The White House went out of its way to confirm that there aren’t any exceptions made for Apple in Trump’s plan.
Projections made by Rosenblatt Securities suggest that the tariffs of China, of which there will be a total of 54% after Trump’s new reciprocal tariffs against the country, could increase the cost of the cheapest iPhone 16 model by 43% – from $799 now to $1,142, depending on how much of the tariff Apple chooses to push onto customers.
The tariffs came despite moves from Apple CEO Tim Cook to try to cozy up to Trump. Cook congratulated Trump on his win in November and was in attendance at Trump inauguration. In February, Apple announced that it would invest over $500bn in US jobs over the next five years, what was largely seen as a play to get Trump to hold back on tariffs.

The world is fast approaching temperature levels where insurers will no longer be able to offer cover for many climate risks ... (and) without insurance, which is already being pulled in some places, many other financial services become unviable, from mortgages to investments.

“This applies not only to housing, but to infrastructure, transportation, agriculture, and industry,” he said. “The economic value of entire regions – coastal, arid, wildfire-prone – will begin to vanish from financial ledgers. Markets will reprice, rapidly and brutally. This is what a climate-driven market failure looks like.”

No governments will realistically be able to cover the damage when multiple high-cost events happen in rapid succession ...

Global financial markets have been plunged into turmoil as Donald Trump’s escalating trade war knocked trillions of dollars off the value of the world’s biggest companies and heightened fears of a US recession. As world leaders reacted to the US president’s “liberation day” tariff policies demolishing the international trading order, about $2tn (£1.5tn) was wiped off Wall Street and share prices in other financial centres across the globe.
Experts said Trump’s sweeping border taxes of between 10% and 50% on the US’s traditional allies and enemies alike had dramatically added to the risk of a steep global downturn and a recession in the world’s biggest economy. The sell-off swept the globe, sending exchanges plunging in Asia and Europe.
When New York trading opened, the S&P 500 index of the US’s leading companies fell by as much as 4.3% in morning trading, with the tech-heavy Nasdaq fund down 5.1%. Meanwhile, the US dollar hit a six-month low, falling by about 2.2% on Thursday morning, amid a growing loss of confidence in a currency that had previously been considered the safest in the world for most of the past century.
Warning clients to beware a “dollar confidence crisis”, George Saravelos, the head of foreign exchange research at Deutsche Bank, said: “The safe-haven properties of the dollar are being eroded.” The heaviest falls in share prices on Thursday were reserved for US firms with complex international supply chains stretching into the countries that Trump is targeting with billions of dollars in fresh border taxes.
Apple, which makes most of its iPhones, tablets and other devices for the US market in China, plunged by as much as 9.5%, along with steep declines for other large multinationals including Microsoft, Nvidia, Dell and HP. Commodities fell sharply, including a 7% plunge in oil prices, reflecting growing concerns over the global economic outlook.
In a typically defiant response on Thursday, Trump used his Truth Social platform to declare that the his plan was working. “THE OPERATION IS OVER! THE PATIENT LIVED, AND IS HEALING. THE PROGNOSIS IS THAT THE PATIENT WILL BE FAR STRONGER, BIGGER, BETTER, AND MORE RESILIENT THAN EVER BEFORE. MAKE AMERICA GREAT AGAIN!!!”
Tariffs will fall heavily on some of the world’s poorest countries, with nations in south-east Asia, including Myanmar, among the most affected. Cambodia, where about one in five of the population lives below the poverty line, was the worst-hit country in the region with a tariff rate of 49%. Vietnam faces 46% tariffs and Myanmar, reeling from a devastating earthquake and years of civil war after a 2021 military coup, was hit with 44%.
Analysts warned that garment and sports shoe makers, which rely heavily on production in south-east Asia, face rising costs, which will push up prices for consumers around the globe. The share prices of Nike, Adidas and Puma all fell steeply. Analysts said Trump’s measures would raise the average tariff, or border tax, charged by the US to the highest level since 1933, in a development that threatened to sink the US into recession while increasing living costs for consumers.
The non-partisan Tax Foundation thinktank said it estimated the plan would represent a “$1.8tn tax hike” for US consumers, which would cause imports to fall by more than a quarter, or $900bn, in 2025. While the measures will hit the US hard, researchers at the consultancy Oxford Economics said they could sink global economic growth to the lowest annual rate since the 2008 financial crisis, barring the height of the Covid pandemic.
The French president, Emmanuel Macron, said Trump’s decision to impose tariffs of 20% on EU goods was “brutal and unfounded”, while Germany’s outgoing chancellor, Olaf Scholz, called it “fundamentally wrong”. Spain’s prime minister, Pedro Sánchez, said the “protectionist” tariffs ran “contrary to the interests of millions of citizens on this side of the Atlantic and in the US”.
The EU is thought to be preparing retaliatory tariffs on US consumer and industrial goods – likely to include emblematic products such as orange juice, blue jeans and Harley-Davidson motorbikes – to be announced in mid-April, in response to steel and aluminium tariffs previously announced by Trump.

I think it's great that people think that launching the largest trade war since the Smoot-Hawley tariff will have no significant impact on world equity and bond markets, much less the bank accounts of John and Jane Doe.
It's just not polite to talk about it.

And that’s the purpose of

Mutual Fund Observer? To debate the great financial issues of the world? Go at it then.