The market plummets after Trump imposes a 25% tax on iPhones, proposing a 50% tax on the EU.

The global financial market opened in the red on Friday after President Donald Trump announced two strong measures: imposing a 25% tax on iPhones not made in America and proposing a 50% tax on all goods from the European Union, starting from June 1, 2025.

Futures on the Dow Jones fell 503 points (-1.2%), the Nasdaq 100 dropped 1.4%, and the S&P 500 retreated 1.2%. Apple shares fell 3% in pre-market trading after Trump stated on Truth Social that "iPhones sold in America must be made in America" and if not, Apple "must pay at least 25% tax."

*"The European Union – established with the main purpose of taking advantage of the United States in the field of TRADE – has always been an extremely difficult partner to work with. They impose strong Trade Barriers, VAT, unreasonable fines on businesses, non-monetary barriers, currency manipulation, unfair and unreasonable litigation against U.S. companies, and many other issues – all of which have resulted in a trade deficit with the U.S. that exceeds $250 million per year. a completely unacceptable number. Negotiations with them are at an impasse! Therefore, I propose to apply a direct tariff rate of 50% to the European Union, starting from June 1, 2025. No tariffs apply if the product is made in the United States. Thank you for your interest in this matter!" *

The president also declared that trade negotiations with the EU have "hit a dead end" and called for a 50% tariff in response to "unfair trade barriers" from Europe. He emphasized that goods produced in America would be exempt from tariffs.

The shock from the new trade policy has caused a stir not only in the stock market but has also dragged the cryptocurrency market down. Bitcoin fell sharply by more than 5% on Friday morning, dropping below the 110,000 USD mark. Many altcoins like Ethereum, Solana, and Avalanche also recorded declines of 4–8% in the past 24 hours.

Notably, Trump's series of tough measures were introduced right after the US Congress passed a large-scale tax bill and just a few days after Moody's downgraded America's credit rating, causing long-term bond yields to surge.

Investor sentiment is being tested as expectations for trade negotiations cool amid the 90-day postponement of tariffs that was previously announced.