Global stock markets plunged on Monday in what is being called “Black Monday,” as fears surrounding escalating U.S.-China trade tensions triggered a massive three-day sell-off that wiped out $9.5 trillion in value worldwide.

The collapse follows President Donald Trump’s announcement of steep tariffs—ranging from 10% to 50%—on imported goods, and China’s swift retaliatory measures. The news sent shockwaves across global markets, leading to the worst downturn since the COVID-19 pandemic.

Asia and Europe Hit Hard

The turmoil began in Asia, where Tokyo’s Nikkei 225 tumbled 7.8% to 31,136.58, briefly suspending futures trading. Hong Kong’s Hang Seng plunged 13.2%, the Shanghai Composite fell 7.3%, and Taiwan’s Taiex nosedived 9.7%. South Korea’s Kospi dropped 5.6%, while Australia’s S&P/ASX 200 fell 4.2% after recovering slightly from steeper losses earlier in the session.

European markets followed suit. Germany’s DAX opened with a dramatic 10% drop before recovering slightly to trade down 5.8%. France’s CAC 40 slid 5.8%, and the UK’s FTSE 100 lost 4.9%.

U.S. Markets on the Brink of Bear Territory

U.S. futures indicated further losses. S&P 500 futures fell 3.4%, Dow Jones futures lost 3.1%, and Nasdaq futures dropped 5.3%. If realized, the S&P 500 would officially enter bear market territory—a 20% decline from its peak—after closing last week down 17.4%.

The decline accelerated Friday, when the S&P 500 plunged 6%, the Dow Jones fell 5.5%, and the Nasdaq lost 3.8%.

“There’s no sign yet that markets are finding a bottom and beginning to stabilize,” Deutsche Bank analysts wrote in a research note.

Trump Stands Firm

Speaking aboard Air Force One, President Trump defended the tariff strategy, stating: “Sometimes you have to take medicine to fix something.” On Truth Social, he insisted the U.S. economy remains strong and claimed tariffs would generate billions in revenue.

Despite these assertions, his policies are causing concern across financial institutions. JPMorgan Chase CEO Jamie Dimon warned that the tariffs could increase inflation, trigger a global recession, and damage America’s global standing.

“If the Western world’s military and economic alliances were to fragment, America itself would inevitably weaken,” Dimon stated in his annual letter to shareholders.

Oil, Currency, and Inflation Fears

Oil prices slumped as well. U.S. crude fell $2.30 to $59.69 per barrel, and Brent crude dropped $2.33 to $63.25, amid fears that slowing global growth would suppress demand.

Currency markets also reacted sharply. The U.S. dollar weakened to 146.24 yen, while the euro gained 0.3% to $1.0992, as investors fled to safer assets.

The Federal Reserve is under pressure to respond, potentially by cutting interest rates. However, Fed Chair Jerome Powell warned that lower rates could stoke inflation.

A Historic Collapse

With the S&P 500 on the verge of its fastest entry into bear territory since the 2020 pandemic, economists worry the U.S. administration’s trade war could reverse years of economic gains.

“This is shaping up to be the worst start to a presidential term in market history,” noted CNN analysts.

Despite hopes for future negotiations, the market’s violent reaction underscores the fragility of the global economy in the face of trade uncertainty.