The Nasdaq Composite fell 3.69 per cent in morning trading on Wall Street shedding 2 per cent from its all-time closing high touched in December. If the index closes below that mark, it would confirm a bear market.

The tariff war instigated by US president Donald Trump has sent shockwaves through global financial markets and raised the fears of an economic downturn, with investment bank JP Morgan forecasting a 60 per cent chance of the global economy entering recession by year-end, up from 40 per cent previously.

China’s finance ministry said on Friday it would impose additional tariffs of 34 per cent on all US goods from April 10th after Mr Trump raised tariff barriers to their highest level in more than a century this week.

US-listings of Chinese companies dived, with JD.com and Alibaba shedding nearly 8.5 per cent each and Baidu falling 7.6 per cent.

Companies with exposure to China also fell across the board, with mega-caps such as Apple falling 4.7 per cent, Nvidia losing 3.4 per cent and Amazon.com slumping 6 per cent.

“We’re beginning to see the inevitable retaliation from the global trade partners of the United States. The risk is that this tips a recession scare into a full-blown recession,” said Ben Laidler, head of equity strategy at Bradesco BBI.

The Dow Jones Industrial Average fell 2.95 per cent to 39,348.79, dropping 10 per cent from its record close and on course to confirm a correction The S&P 500 dropped 3.3 per cnet to 5,216.99.

The CBOE Volatility index, known as Wall Street’s fear gauge, hit its highest level since August 2024 at 37.66 points.

Wall Street’s main indexes posted their biggest single-day percentage declines in years on Thursday after Mr Trump imposed a 10 per cent tariff on most imports into the United States and much higher levies on dozens of other countries.

Investors have shunned riskier assets including stocks and commodities in recent weeks on bets that the tariffs will spark an economic slowdown, prompting them to seek safer assets such as government bonds and gold.

US bank stocks dropped further on Friday, with the sector under pressure globally, as investors anticipated more interest rate cuts from central banks and a hit to economic growth from tariffs.

Bank of America, JPMorgan Chase and Citigroup all fell around 5 per cent each. The yield on the benchmark 10-year Treasury notes was down to a six-month low of 3.938 per cent.

A US Labor Department report showed the US economy added far more jobs than expected in March, but Mr Trump’s sweeping import tariffs could test the labour market’s resilience in the months ahead amid sagging business confidence.

The dollar found a footing on Friday, however, with the euro down 0.5 per cent after rallying 1.9 per cent on Thursday, while the pound fell 0.7 per cent.

Japan’s yen, a traditional safe haven, held broadly steady after rallying around 2 per cent the previous day. The Swiss franc, another safe haven, perked up about 0.6 per cent. – Reuters