Market panic mounts as world scrambles to temper Trump tariffs

Wall Street braced Sunday for significant losses at the start of the week over Donald Trump's punishing tariffs on exports to the US, as oil prices plummeted even with countries seeking compromise with the defiant president.

The Republican denied Sunday he was intentionally engineering a market selloff and insisted he could not foresee market reactions, saying he would not make a deal with other countries unless trade deficits were solved.

"Sometimes you have to take medicine to fix something," he said of the market pain that has seen trillions of dollars wiped off the value of US companies since the beginning of his tariff rampage.

Speaking to reporters aboard Air Force One, he added that he had engaged with world leaders on the issue to seek resolution over the weekend, claiming "they're dying to make a deal."

Futures contracts for the New York Stock Exchange's main boards were sharply down Sunday, suggesting more pain for battered Wall Street stocks when markets open Monday, while US oil dropped below US$60 a barrel for the first time since April 2021.

A little over half an hour after the contracts resumed trading at 10pm GMT, the Dow Jones Industrial Average was down 3.56 percent, while the broader S&P 500 index was down 3.85 percent.

'Deals and alliances'

Benjamin Netanyahu, the prime minister of Israel — which has been hit with 17 percent tariffs, despite being one of Washington's closest allies — will fly in for crunch talks with Trump Monday on the levies.

Britain's Prime Minister Keir Starmer warned in a newspaper op-ed that "the world as we knew it has gone," saying the status quo would increasingly hinge on "deals and alliances."

Trump's staggered deadlines have left space for some countries to negotiate, even as he insisted he would stand firm and his administration warned against any retaliation.

"More than 50 countries have reached out to the president to begin a negotiation," Kevin Hassett, head of the White House National Economic Council, told ABC's This Week on Sunday, citing the US Trade Representative.

Vietnam, a manufacturing powerhouse that counted the US as its biggest export market in the first quarter, has already reached out and requested a delay of at least 45 days to thumping 46 percent tariffs imposed by Trump.

Hassett said countries seeking compromise were doing so "because they understand that they bear a lot of the tariffs," as the administration continues to insist that the duties would not lead to major price rises in the United States.

"I don't think that you're going to see a big effect on the consumer in the US," he said.

'Markets bloodbath'

Treasury Secretary Scott Bessent also told NBC's Meet the Press that 50 countries had reached out.

But as for whether Trump will negotiate with them, "I think that's a decision for President Trump," Bessent said.

"At this moment he's created maximum leverage for himself... I think we're going to have to see what the countries offer, and whether it's believable," Bessent said.

Other countries have been "bad actors for a long time, and it's not the kind of thing you can negotiate away in days or weeks," he claimed.

Despite hopes for negotiations to avert the worst economic carnage, there was widespread fear that the markets bloodbath could continue into the new trading week.

In Saudi Arabia, where the markets were open Sunday, the bourse was down 6.78 percent — the worst daily loss since the COVID-19 pandemic, according to state media.

Larry Summers, formerly Director of the National Economic Council under president Barack Obama, said, "there is a very good chance there's going to be more turbulence in markets the way we saw on Thursday and Friday."

Peter Navarro, Trump's tariff guru, has pushed back against the mounting nervousness and insisted to investors that "you can't lose money unless you sell," promising "the biggest boom in the stock market we've ever seen."