Stocks, dollar tumble as Trump tariff fears jolt markets; gold hits record

Markets were thrown into turmoil again Friday as renewed fears over U.S. tariffs triggered a broad sell-off in equities and the dollar, while gold surged to a fresh record high.

The volatility followed President Donald Trump’s admission that his aggressive global tariff push would come with a “transition cost,” prompting fresh panic among investors already rattled by his economic confrontation with China.

Stocks had rallied Thursday after Trump announced a 90-day pause on new tariffs, but markets quickly reversed course when it became clear that no concrete resolutions had been reached. Trump’s vow to reinstate the tariffs if no deals are made further spooked investors.

Asian markets ended a turbulent week deep in the red. Tokyo’s Nikkei 225 dropped over 4.2 percent, erasing much of Thursday’s massive 9.5 percent rally. Markets in Sydney, Seoul, Singapore, Taipei, Wellington, Jakarta, and Manila also fell sharply. Ho Chi Minh City bucked the trend on news of upcoming trade talks with the U.S., while Shanghai saw limited losses amid speculation about Chinese stimulus measures.

Hong Kong’s Hang Seng Index slid 1.1 percent, and the Shanghai Composite edged down 0.3 percent, despite Beijing’s pledge to adopt a “moderately loose” monetary policy.

The rout mirrored sharp losses on Wall Street, where the S&P 500 shed 3.5 percent, the Dow dropped 2.5 percent, and the Nasdaq fell 4.3 percent, reversing much of the previous day’s gains.

Currency markets were equally shaken. The dollar slipped against major currencies including the yen, euro, pound, and Swiss franc, with investors fleeing U.S. assets—including traditionally safe-haven U.S. Treasuries. The sell-off in bonds pushed yields higher, raising concerns about the cost of U.S. debt and the long-term stability of the dollar.

The weaker dollar and increased demand for safe-haven assets pushed gold to a new record high above $3,200 per ounce, while oil prices continued to fall on fears of a global economic slowdown. West Texas Intermediate and Brent crude were both down 0.7 percent.

“There has been a pronounced ‘sell U.S.’ vibe,” said Chris Weston of Pepperstone Group. “The dollar is losing its safe-haven status as foreign investors repatriate capital, sensing that the tariff pause was driven by rising systemic risk.”

Michael Krautzberger of Allianz Global Investors warned that the dollar’s decline might signal deeper doubts about its role as the world’s reserve currency. “The real danger now is that the trade war becomes a capital war,” he said, noting the risk that foreign holders of U.S. Treasuries, especially in tariff-impacted countries, could start selling off American debt.

Trump, meanwhile, downplayed the market chaos, saying, “In the end, it’s going to be a beautiful thing,” as he defended tariffs as a tool to reshape the global economy and bring manufacturing back to the U.S.

Commerce Secretary Howard Lutnick added fuel to the optimism on social media, writing: “The Golden Age is coming. We are committed to protecting our interests, engaging in global negotiations and exploding our economy.”

Still, Trump warned that if agreements aren’t reached, the delayed tariffs will return. “If we can’t make the deal we want to make… then we’d go back to where we were,” he said.

Key figures around 02:30 GMT:

– Tokyo – Nikkei 225: DOWN 4.2% at 33,148.45
– Hong Kong – Hang Seng Index: DOWN 1.1% at 20,452.64
– Shanghai – Composite: DOWN 0.3% at 3,214.14
– Dollar/yen: DOWN at 143.43 yen (from 144.79 yen)
– Euro/dollar: UP at $1.1305 (from $1.1183)
– Pound/dollar: UP at $1.3021 (from $1.2954)
– Euro/pound: UP at 86.83 pence (from 86.33 pence)
– WTI crude: DOWN 0.7% at $59.63/barrel
– Brent crude: DOWN 0.7% at $62.92/barrel
– New York – Dow Jones: DOWN 2.5% at 39,593.66 (close)
– London – FTSE 100: UP 3.0% at 7,913.25 (close)