US stocks saw fluctuations on Monday, swinging between sharp gains and losses as markets attempted a brief recovery from a two-day slump that had pushed major indices to multi-month lows and into bear market territory, before ultimately slipping back into the red. Investor sentiment remained heavily influenced by trade developments, with ongoing recession fears exacerbated by President Donald Trump’s sweeping tariff policies. Markets briefly reacted positively to reports suggesting that President Trump was considering a 90-day tariff pause for all countries except China, although this optimism quickly faded.

In local economic news, the South African rand fell to its weakest level in 18 months on Monday, while local stocks initially came in lower before recovering. This was in response to U.S. President Trump’s broad tariff measures and growing global recession concerns. At 14h56 GMT, the rand traded at 19.58 against the dollar, down approximately 2.40% from Friday’s close, marking its weakest level since October 2023, as reported by Reuters. On the Johannesburg Stock Exchange, the Top-40 index (.JTOPI) dropped 5% in early trade to a nine-and-a-half-month low, before recovering slightly to trade down 0.20%.

In the UK, markets also recorded losses, with the FTSE 100 falling by over 4.50% on Monday, dropping below 7 700 for the first time in more than a year as the global sell-off driven by Trump’s tariffs deepened. Investor concerns over the impact on economic growth intensified after China announced retaliatory measures, heightening fears of a full-scale trade war. Despite these concerns, Trump dismissed fears of inflation or recession, insisting that a market boom was imminent. The sell-off was widespread, with every FTSE 100 stock in the red.

European markets followed suit, with the STOXX 50 dropping 6.80% on Monday, reaching its lowest level since August, while the STOXX 600 dropped 5.60%, hitting lows not seen since December 2023. The sell-off extended steep losses from the previous week, which had marked the worst weekly performance since 2020. Investor sentiment remained under significant pressure amid fears of a worsening trade war, especially after China announced retaliatory tariffs of 34% on a wide range of U.S. goods.

Japanese markets mirrored the global trend, with the Nikkei 225 Index falling 7.80% to close at 31 136, while the broader Topix Index tumbled 7.80% to 2 289, reaching its lowest level since October 2023 as the global sell-off intensified in response to fears of a global recession. The Chinese market followed suit, with the Shanghai Composite dropping 7.34% to close at 3 097, and the Shenzhen Component falling 9.66% to 9 364 in post-holiday trade on Monday, tracking the global sell-off as U.S. President Trump’s trade war stoked widespread recession fears.

In the commodities market, WTI crude futures reversed earlier gains, falling back to $61 per barrel, their lowest level since April 2021, after speculation of a 90-day pause on U.S. tariff policies proved to be unfounded. Meanwhile, gold dropped below $3 030 per ounce, marking its third consecutive session of losses as profit-taking and margin calls in other asset classes prompted investors to liquidate some of their gold holdings to cover losses.