(BFM Stock Exchange) – The American indices are opening up sharply on Monday, April 7, while investors expect Donald Trump customs initiatives to result in inflationary tensions and lower growth in the United States.

Wall Street opens in very sharp drop to start the week. Like other world places, the American square still suffers from massive customs duties decided by Donald Trump on April 2.

This Monday, April 7, the major American indices still open up in clear decline, with a Dow Jones which loses 3.2%, the S&P 500 fell back for its part of 3.6%when the Nasdaq drops by almost 4%.

In Europe, the CAC 40 in Paris, Dax in Frankfurt and the FTSE Mib in Milan yield almost 5%, when the Footsie in London restores 3.8% to the opening of the American markets.

“Don’t be weak”

Shortly before the opening of Wall Street, Donald Trump recalled that with his trade policy, “the United States had the opportunity to do something that should have been done ten years ago”.

“Do not be weak! Do not be stupid! (…) Be strong, courageous and patients and the size will be there,” he wrote on his social network “Truth Social”.

Since the announcement of his customs duties on Wednesday, Donald Trump has caused a shock wave in the world and American markets.

Friday, April 4, Wall Street had a nightmare session, sounded by the Chinese response to American customs duties.

The Dow Jones then unscrewed 5.50%, the Nasdaq of 5.82%when the S&P 500 wiped its worst stock market since 2020, dropping almost 6%. These important folds were already involved after a black Thursday which had lost $ 2,400 billion in capitalization in S&P 500 according to Reuters.

Donald Trump’s Bazooka Douanier has lost more than $ 6,000 billion in market capitalization in Wall Street on Thursday and Friday, according to the Dow Jones US Total Stock Market index. cited by AFP. On the whole of last week, the Dow Jones gave 8%, the S&P 500 9%and the Nasdaq almost 10%.

“If the indices do not return above the limit of 20 % decrease in the next 2 to 3 weeks, this could lead a longer period of withdrawal,” warns Hani Abuagla Analyst of the Middle East Senior and North Africa at XTB.

A risk of major recession in the United States?

The recent words of the President of the American Federal Reserve (Fed), Jerome Powell had not contributed to appease the spirits either. On Friday, he said that the customs duties set up by Donald Trump were “probably increasing inflation” and that they were likely to increase unemployment and slow down growth in the United States.

“The deterioration of stock markets would soon be followed by a collapse of the confidence of households and businesses, the economy entering into recession in the space of a few months,” predicts Capital Economics, for the United States alone.

Donald Trump does not share this ambient pessimism. On his Truth Social network, the American president said on Monday that his announcements made it possible to lower bond rates, oil prices and food prices. According to him, there is no inflation (in capital letters in the text), he also added.

“Nevertheless, it should be recalled that at the moment, any contribution of liquidity from the government or the Fed or any positive information on the trade war on the part of Trump can change the situation on the market in just a few hours,” said Hani Abuagla.

Capital Economics considers that Donald Trump will make a back machine, and that reciprocal customs duties will amount between 10% and 20% after negotiations, with the exception of China.