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The Ftse100 has dropped sharply on opening on Monday morning, falling initially by 241.88 points (three per cent).
The London stock market dropped even further just minutes later by 6.1 per cent.
The pan-European STOXX 600 slumped 5.8 per cent upon opening on Monday morning.
This comes as global markets plunged again as Donald Trump remains defiant on his tariffs, comparing them to “medicine”.
The US stock futures fell overnight ahead of opening on Monday, with the Dow Jones dropping by 1,033 points (2.68 per cent).
The S&P 500 futures shed 3.34 per cent, while Nasdaq futures plunged even further with 4.26 per cent.
Meanwhile Asian markets suffered a brutal opening on Monday morning, with the Hang Seng in Hong Kong plummeting by nearly 13 per cent, in what could end up being its worst day since 1997.
That means it has fallen by 20 per cent since its record highs in March, while in mainland China the CSI 300 in Shanghai fell by eight per cent.
This follows a market wipeout at the tail end of last week, with the Ftse100 closing at its lowest level so far this year, bottoming out at 8,054 – a drop of more than 800 points (10 per cent).
The Dow posted back-to-back losses of more than 1,500 points for the first time ever, including a 2,231-point fall on Friday.
The S&P 500 dropped six per cent on Friday for its worst performance since the outbreak of the coronavirus pandemic in March 2020.
The Nasdaq entered a bear market on Friday, down six per cent on both Thursday and Friday, and 22 per cent from its record.
Despite all this turmoil, President Trump has remained defiant, telling reporters late last night: “I don’t want anything to go down. But sometimes you have to take medicine to fix something.”
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Donald Trump’s finance chief rejects US recession fears
Donald Trump’s finance chief has rejected fears of a US recession, despite markets tumbling again.
Scott Bessent, the treasury secretary, said there was “no reason” to expect a downturn in America and that the economy will be helped by strong job numbers, low borrowing rates and falling oil prices.
He said: “I see no reason that we have to price in a recession. Markets are organic animals and you never know what the reaction’s going to be. We get these short-term market reactions from time to time.
“There doesn’t have to be a recession. Who knows how the market is going to react in a day, in a week?”
Taiwan stocks plummet in biggest one-day drop on record
Taiwan stocks plummeted almost 10 per cent on Monday, the biggest one-day percentage fall on record.
Taiwan, hit with a 32 per cent duty, was singled out by Donald Trump as among the US trading partners with one of the highest trade surpluses with the country.
After resuming trade on Monday following market holidays on Thursday and Friday, Taiwan’s benchmark stock index (.TWII).
European shares plunge to 16-month low
The pan-European STOXX 600 slumped 5.68 per cent
European shares plunged to a 16-month low on Monday as investors grappled with the possibility of a recession after sweeping tariffs announced by United States last week.
The pan-European STOXX 600 slumped 5.68 per cent, after registering its steepest one-day percentage decline since the Covid-19 pandemic on Friday.
Trade-sensitive Germany’s benchmark index (.GDAXI), dove 6.6 per cent, among the worst hit, with Commerzbank (CBKG.DE), and Deutsche Bank (DBKGn.DE), shedding 10.7 per cent and 10 per cent, respectively.
Goldman Sachs raises US recession risk by 10 per cent
Goldman Sachs economists have raised their estimation of a US recession within a year to 45 per cent – up 10 per cent from a previous estimate of 35 per cent.
The economists said that if most of the tariffs take effect on Wednesday, April 9, then the effective tariff rate will rise by an estimated 20 points.
They said: “If so, we expect to change our forecast to a recession.”
Pound and euro rise as investors lose faith in the dollar
The pound has risen against the dollar by 0.2 per cent as investors are voicing their concerns over the world’s largest economy.
Meanwhile the euro gained 0.4 per cent on the dollar.
£1 now equates to $1.292, while €1 is $1.10.
Britain to suffer £22bn hit from Donald Trump’s tariffs
Trump’s trade war could severely derail Rachel Reeves’s economic plans
PA
Donald Trump’s tariffs are set to deliver a £22billion hit to Britain, economists have warned.
New analysis from KPMG predicts that the US President’s trade war will shave 0.8 per cent off the economy over the next two years.
The ‘Big Four’ firm slashed the UK’s growth forecasts for the current year from 1.7 per cent down to 0.8 per cent as a result.
This will leave the UK £21.6bn worse off by 2027, as Trump’s 10 per cent tariffs threaten to derail Labour’s plans.
Yael Selfin, KPMG’s chief UK economist, said: “There are so many things that could get worse.
“Ultimately, the main worry is confidence. Trade disruption is bad, but uncertainty is the big unknown.”