Global stock markets saw a sharp decline on Tuesday, with major indices reacting negatively to escalating trade tensions. The Dow Jones and S&P 500 dropped 1.50% and 1%, respectively, as investors sought safer assets following the implementation of new tariffs. A 25% duty on imports from Canada and Mexico, along with a 10% levy on Chinese goods, came into effect, prompting immediate retaliatory measures from Canada and China.

European stocks also took a hit, pressured by trade tensions and heightened geopolitical risks surrounding the war in Ukraine. The STOXX 50 fell 2.80% from its record high to 5 385, while the STOXX 600 lost 2.20% to 551. President Trump not only imposed 25% tariffs on Canadian and Mexican goods but also raised tariffs on Chinese imports to 20%, leading all three nations to announce countermeasures. This further fuelled risk aversion across global markets tied to US demand and credit exposure.

In Asia, the Hang Seng lost 0.30% to close at 22 942, reversing modest gains from the previous session. Concerns over US-China trade relations weighed on the market, with Beijing swiftly responding to new US tariffs by increasing levies on various American agricultural and food products by 10%-15% and placing 25 US firms under export and investment restrictions. However, losses were partially trimmed amid expectations that China's annual parliamentary session, the Two Sessions, would outline key economic priorities for 2025. Meanwhile, Japan’s Nikkei 225 fell 1.20% to 37 331, erasing previous gains as global trade tensions escalated with the implementation of new US tariffs.

South Africa’s stock market also closed lower, reacting to economic data that showed the country's GDP grew by 0.60% in the fourth quarter of 2024, rebounding from a revised 0.10% contraction in the previous quarter. This brought the full-year growth rate for 2024 to 0.60%, slightly below the 0.70% expansion recorded in 2023. The rand remained under pressure, trading at R18.58 per dollar by 18h00.

In the commodities market, Brent crude oil futures fell to $70.80 per barrel, nearing a four-month low, as OPEC+ confirmed plans to increase output by 138 000 barrels per day in April—the first production hike since 2022. Meanwhile, gold prices surged to $2 915 per ounce, approaching last week’s record high of $2 950, as investors sought safe-haven assets amid the worsening trade dispute. President Trump’s tariff measures against Canada, Mexico, and China, along with plans to impose tariffs on the EU and raise levies on agricultural exports, further fuelled market uncertainty.