The Trump administration is holding firm on its tariff plans despite tumbling stock markets, counteroffers from America’s trading partners, and growing Republican opposition in both the House and Senate.
The baseline 10 percent tariffs took effect on Saturday, with the reciprocal tariffs set to follow on Wednesday.
U.S. Futures Tumble and Global Stocks Continue to Collapse
Futures—contracts allowing investors to sell or buy stocks at a specific price on a later date—for the three major indexes were down in the U.S. on Monday. Futures tied to the Dow Jones Industrial Average were down more than 2.2 percent at 8:03 a.m. ET, while Nasdaq futures were down close to three percent. S&P 500 futures meanwhile had dropped 0.26 percent.
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This is likely to translate into another difficult day for Wall Street once trading begins—following on from its worst week since the COVID-19 pandemic— given how global markets have opened.
A sell-off has swept Asia, with Hong Kong’s Hang Seng Index sliding 13.2 percent for its steepest one-day decline since 1997.
China’s CSI 300 and the SSE Composite fell by 7.1 percent and 7.3 percent respectively, while the MSCI China index dropped 13.1 percent.
Both the Topix and Nikkei 225—two of Japan’s largest indexes—dropped 7.8 percent on Monday, while South Korea’s benchmark KOSPI dropped 5.6 percent.
European stocks have opened on a similarly downbeat note, with the Euro Stoxx 50 down 3.8 percent so far, the Stoxx Europe 600 down 3.7 percent and the FTSE 100 down 4.1 percent in early trading.
Trump’s Team Says No—or Maybe—to Negotiations
Following the announcement of President Donald Trump‘s reciprocal tariff rates on Wednesday, countries have reportedly been scrambling to meet with the administration and avoid the potentially crippling hit to their exports.
According to U.S. Treasury Secretary Scott Bessent, over 50 nations have so far approached the White House about lowering the trade barriers which gave rise to the reciprocal tariffs, but the administration appears insistent that the duties are here to stay.
On Sunday, the president told reporters that he would only be prepared to negotiate lower tariffs with China if the country reduced its trade surplus with the U.S.—”a trillion dollars” according to Trump but just under $300 billion according to the U.S. Trade Representative.
“I’m willing to deal with China, but they have to solve their surplus,” he said.
During a previous gaggle aboard Air Force One, Trump said he would be open to negotiations if other countries offered something “so phenomenal,” adding that the tariffs “give us great power to negotiate.”
The Chinese government has accused Trump of “economic bullying” and “weapon[zing] tariffs to exert maximum pressure for selfish interests,” while retaliating with its own 34 percent tariffs on all U.S. imports from April 10.
The country has called on the U.S. to “immediately lift unilateral tariffs and resolve trade differences through consultation on an equal, respectful and mutually beneficial basis.”
Vietnam, slapped with a 46 percent “discounted tariff” last week, has offered to lower its tariffs on U.S. imports to postpone the duties until the two countries can hold trade negotiations.
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On Sunday, however, U.S. senior trade counselor Peter Navarro rejected this possibility, telling Fox News: “This is not a negotiation, this is a national emergency based on a trade deficit that’s gotten out of control because of cheating.”
Navarro called Vietnam the “poster child for nontariff cheating,” and said that even if the country were to remove all tariffs, this would barely make a dent in its $123.5 billion trade surplus with the U.S.
“There is no postponing,” U.S. Commerce Secretary Howard Lutnick said on CBS News’ Face the Nation. “They are definitely going to stay in place for days and weeks. That is sort of obvious. The president needs to reset global trade. Everybody has a trade surplus and we have a trade deficit. We are paying away our future and our lives.”
Bessent, similarly, said that after decades of “bad behavior,” countries would not be able to negotiate away the tariffs “in days or weeks.”
However, he did not completely reject the possibility of deals being struck, telling NBC News that the administration would have to see “what the countries offer and whether it’s believable.”
Republican Opposition Grows
Amid the historic stock market selloffs and the anticipated toll a trade war could take on an already shaky economy, opposition to the tariff plans has been growing among members of both parties.
Kentucky Senator Rand Paul has been leading the Republican anti-tariff charge, arguing in a speech on Wednesday that Conservatives had surrendered their former support for free trade and opposition to taxes under Trump, and that the president’s unilateral imposition of tariffs was unconstitutional.
“Tariffs are simply taxes,” Paul said. “Tariffs don’t punish foreign governments, they punish American families.”
On Wednesday, Paul was one of four Republicans who voted in support of a measure aimed at ending the national emergency declaration that authorized tariffs on Canadian imports.
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On Thursday, Paul reintroduced legislation aimed at reasserting Congress‘ “constitutional authority over taxation,” and requiring that any import taxes will require congressional authorization.
Late last week, Nebraska Representative Don Bacon said he would be introducing a companion bill to the bipartisan Senate legislation aimed at expanding congressional authority over tariffs.
Bacon told CBS News that the measures had the support of seven Republicans in the Senate and “some beginning support on the House side.”
“Congress has to step in and say, do we really want to create this new policy on tariffs?” Bacon added. “And if it is, it should come from the Congress and not the president.”
White House Dismisses Recession Risks
Following one of the worst stock market slumps of this century, the odds of a recession have grown significantly according to betting markets and financial analysts.
According to crypto-based betting platform Polymarket, the chances of a recession occurring in 2025 have grown from 39 percent on April 1—the day before Trump’s Rose Garden speech—to 68 percent. Bettors on Kalshi, similarly, put these odds at 67 percent, up from 42 percent on April 1 and 56 percent on Friday.
On Friday, J.P. Morgan revised its own predictions, according to Reuters, now seeing a 60 percent chance of a global recession within the year, up from 40 percent previously. The firm cited “disruptive U.S. policies” as the biggest catalyst, adding that the risk was likely to be “magnified” as countries retaliate against the new duties.
Against this, Bessent told NBC News that he “rejected the assumption” that there would be a recession, and reiterated that the administration was building up “the long-term economic fundamentals for prosperity.
“I see no reason that we have to price in a recession,” the treasury secretary said. “Markets are organic animals and you never know what the reaction’s going to be. We get these short-term market reactions from time to time.”