Trade Tensions Roil Markets as Stock Indexes Tumble

Major stock indexes fell amid escalating trade tensions between the U.S. and China. New tariffs stoked inflation concerns and market volatility, impacting stocks globally. The U.S. Treasury yield curve steepened as investors awaited U.S. quarterly earnings reports, and oil prices declined due to recession worries.

In a tumultuous turn of events, major stock indexes plunged on Tuesday as intensifying trade tensions between the United States and China spooked investors. New tariffs announced by the U.S. contributed to fears of slowing economic growth and inflation, which have been unsettling markets since last week.

Market volatility surged, with the Cboe Volatility Index marking its highest closing level since April 2020. The U.S. Treasury yield curve steepened sharply as longer-dated yields increased amidst worries about weak demand for U.S. government debt. Meanwhile, investors are closely watching upcoming earnings reports for potential stock market support.

Oil prices dipped amid escalating recession concerns linked to the trade war, while currency fluctuations saw the U.S. dollar weaken against other major currencies. As uncertainties loom, Wall Street continues to grapple with the ripple effects of the ongoing trade disputes.

(With inputs from agencies.)