Stock Market Faces Uncertainty After Trump's Tariff Announcement

Winter time for the global trading system and great uncertainty. This is how experts describe the situation after President Donald Trump's tariff announcement on Wednesday. And after the Stockholm Stock Exchange opened on Thursday, broad declines are seen. Hope is now pinned on negotiations that could calm the stock market anxiety.

» Published: April 03 2025

Stock Market Faces Uncertainty After Trump's Tariff Announcement
Photo: Lisa Arfwidson/SvD/TT

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The market has reacted after President Donald Trump's aggressive tariff package was presented on Wednesday. The message was general tariffs of ten percent and additional tariffs for 60 countries.

After the Stockholm Stock Exchange opened on Thursday, broad declines are seen. The Stockholm Stock Exchange is down 2.5 percent an hour after opening. At the bottom are all cyclical-sensitive companies, the automotive industry, engineering, and consumer companies.

Red all over

A completely obvious interpretation is that the economy will get worse going forward due to the tariffs. Higher prices and lower demand. It's red all over on the stock exchange when you try to get a grip on what this will mean, says Maria Landeborn, senior strategist at Danske Bank.

In Asia, the stock exchanges closed on minus overnight and the expectation is that the US stock exchanges will also open sharply lower.

This is about the tariffs being more comprehensive than what was hoped for and creating great uncertainty regarding the economy, inflation, and corporate profits, which is reflected on the stock exchange.

Landeborn receives support from Roger Bergqvist, senior economist at SEB.

This is a scenario that the stock exchanges hate.

The US has turned back the clock to winter time for the global trading system, he says.

Hoping for negotiations

What happens next is difficult to predict and the big question is what the next step will be – negotiations or retaliatory tariffs. Experts are putting their hopes in negotiations that can bring down the tariffs.

The faster it goes, the sooner we can see a stabilization on the markets. If there are a lot of retaliatory tariffs, we'll have a tough time, says Maria Landeborn.

The US has shown its cards and now it's Europe's turn, says Bergqvist, referring to Ursula von der Leyen's statement on Thursday morning where she stated that the EU wants to come to the negotiating table.

How worried do you need to be?

Recession and low economic growth could mean large stock market falls of 30-50 percent, but that's not the main scenario, even though we'll see a slowdown. We'll get through this too, even though it's shaky right now, says Maria Landeborn.

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By TTEnglish edition by Sweden Herald, adapted for local and international readers

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