US STOCKS PLUNGE AS MARKET RESUMES TRUMP TARIFF SELL-OFF

NEW YORK, April 11 (Bernama-Xinhua) -- US stocks ended lower on Thursday, giving back gains from the previous day's historic rally as investors grew increasingly anxious over trade tensions between the United States and China, reported Xinhua.

The Dow Jones Industrial Average sank 1,014.79 points, or 2.50 per cent, to close at 39,593.66. The S&P 500 dropped 188.85 points, or 3.46 per cent, to 5,268.05, while the Nasdaq Composite Index tumbled 737.66 points, or 4.31 per cent, ending the day at 16,387.31.

Most sectors within the S&P 500 closed in the red, with energy and technology suffering the steepest losses, down 6.40 per cent and 4.55 per cent, respectively. Consumer staples was the lone gainer, rising modestly by 0.19 per cent.

The sharp reversal came after the White House clarified that the total effective tariff rate on Chinese imports had climbed to 145 per cent, up from the 125 per cent figure cited earlier in the week.

That confirmation erased earlier optimism following US  President Donald Trump's temporary reduction of tariffs on goods from other nations to 10 per cent for a 90-day period. Both Canada and Mexico were exempted from the additional duties, and the European Union also followed suit by announcing a similar three-month pause on levies for US products.

"The trade war is now turning into a direct confrontation between the US and China ... we could again be seeing escalation and de-escalation at the same time, pulling markets in different directions," Rabobank analysts said.

While markets initially rallied on the reprieve for US trading partners, analysts warn that the situation with China remains the primary risk.

According to Morgan Stanley, despite the delay in some tariffs, the spike in Chinese duties alone pushes the overall tariff burden to a historic high - suggesting the market may still face significant headwinds in the weeks ahead. "Delays help, but do not reduce uncertainty," Michael Gapen, Morgan Stanley chief US economist, wrote in a Thursday note.

On the economic front, the latest Consumer Price Index report for March indicated that inflationary pressures moderated more than anticipated. On a year-over-year basis, prices rose 2.5 per cent, falling short of economists' forecasts. Compared to the previous month, the index actually dipped by 0.1 per cent, defying expectations of a 0.1 per cent increase and signalling a potential cooling in consumer price growth. 

--BERNAMA-XINHUA