US-China Trade War Sinks US Stocks 3.5%, Crypto 2.67%

The escalating threat of the US-China trade war has overshadowed the benefits of slowing inflation, leading to significant declines in both the US stock market and the cryptocurrency market. The US stock market failed to sustain Wednesday's sharp rebound, with the three major indexes falling by more than 5% at one point on Thursday before narrowing losses towards the close. The S&P 500 fell by 3.5%, having dropped as much as 6.3% intraday, approaching the first level circuit breaker of 7%, marking the largest intraday drop since March 2020. The Nasdaq fell by 4.31%, and the Dow fell by 2.5%. Large-cap tech stocks collectively declined, with the Big Seven Tech Index falling by 6.67%.

In the crypto market, a strong rebound from the previous day followed the sharp turn in US stocks last night, with Bitcoin sliding all the way from $82,000 to a low of $78,464, almost completely erasing the previous day's gains. At the time of writing, it is trading at $80,258, down by 2.67%. Among the top ten mainstream coins, Ethereum performed the weakest, affected by whale selling and the sUSD decoupling, dropping once again below $1,500, and currently trading at $1,541, a 6% drop in the past 24 hours.

Regarding commodities, the US Dollar Index fell by 1.89%, marking its largest single-day drop since 2022. Oil prices fell by over 3% due to weak supply and demand expectations. Safe-haven sentiment soared, pushing gold to touch $3,220, once again hitting a new all-time high.

The latest data shows that the US CPI for March was below expectations across the board, but the impact of tariffs has not yet fully materialized, which is aimed at reassuring investors in the future. As Trump's chaotic tariff policy continues to disrupt the markets and expectations of global supply chain tension intensify, broader concerns about economic recession have been raised. The market remains skeptical about whether a 90-day tariff delay will bring about substantive negotiation results.

The escalation of trade tensions between the United States and China has created significant uncertainty in global financial markets, with both U.S. stocks and the cryptocurrency market experiencing declines. The threat of escalating tariffs has raised concerns about the potential for a global recession, as well as the stability of the global financial system. The impact of the trade war on the U.S. economy and global trade flows remains uncertain, with analysts forecasting a range of potential outcomes depending on the duration and severity of the trade war.