Tariff Shockwaves Rattle Markets Despite Strong Jobs Report
2min read The financial markets are reeling as the full weight of President Trump’s sweeping tariff policies sinks in, sparking a steep sell-off across sectors and clouding what had otherwise been a strong economic data release.
Despite a robust March jobs report that showed nonfarm payrolls rose by 228,000—well ahead of expectations for 135,000—the tone on Wall Street turned sour as China retaliated with a 34% tariff on U.S. goods. This move comes on the heels of Trump’s announcement to eliminate the "de minimis" exemption on Chinese imports under $800, effective May 2.
Ask Aime: How will the tariff wars impact the U.S. economy?
In a fiery post on Truth Social, President Trump doubled down on his protectionist agenda, declaring:
But not everyone sees it that way.
Angelo Zino, CFA, VP and senior equity analyst at CFRA Research, warns that the end of the "de minimis" exemption is likely to weigh heavily on digital ad platforms and e-commerce players. “Both Shein and Temu have increasingly spent more on advertising within the U.S. over the last two years, specifically on META’s platforms,” Zino writes. “The end of the exemption could have negative implications as we see increasing odds that those China-based players now pull back on U.S. spending.”
Zino also notes that deteriorating enterprise fundamentals due to the tariff drag could further squeeze budgets, leading to broader pullbacks in ad spending. Historically, smaller platforms like pinterest and Snapchat feel the impact first, while Alphabet’s search business remains more resilient.
Tariff Tech Turmoil
The ripple effects are already visible. Tech stocks were pummeled, with the NASDAQ falling 5% and the S&P 500 dropping 4% Thursday. A blistering analysis from Wedbush Securities titled “Discussing the Tariff Economic Armageddon That Has Crushed the Tech Trade” likens the moment to the worst self-inflicted economic blunder in recent memory.
“In 25 years covering the markets…never have we seen a self-inflicted debacle of epic proportions like the Trump tariff slate over the last 36 hours,” wrote analysts Daniel Ives and team. “50% China tariffs, 32% Taiwan tariffs would essentially cause a shut-off valve from the U.S. tech landscape…and crush the AI Revolution theme.”
They argue that the costs for U.S. consumers could spike dramatically—“iPhones made in the U.S. would cost $3,500 (vs. $1,000)”—and warn of a looming stagflation scenario if negotiations don’t begin swiftly.
The energy sector also wasn’t spared. Stewart Glickman, CFA, Deputy Research Director at CFRA, commented that energy stocks suffered losses of up to 15% in the wake of Trump’s tariff announcement. “Crude oil prices fell sharply, with WTI dropping to just under $67/b,” Glickman noted, citing concerns about GDP growth and oil demand. He added that OPEC+’s decision to accelerate production cut unwinding further complicated the outlook.
CFRA continues to hold a neutral stance on the Oil & Gas E&P sub-industry, projecting WTI to average $65/b in 2025, down from $77/b in 2024.
And yet, against this economic maelstrom, the March jobs report provided a glimmer of strength. Gains were seen across healthcare, social assistance, retail (aided by strike resolutions), and transportation. Private payrolls climbed by 209,000, and average hourly earnings rose 0.3% month-over-month and 3.8% year-over-year.
Still, the optimism may be short-lived. With tariffs taking center stage and reverberating across global markets, analysts are increasingly skeptical that strong employment alone can carry investor sentiment.
“This is not just market volatility,” said one portfolio manager. “This is structural disruption.”
As investors try to decipher the longer-term consequences of Trump’s aggressive trade maneuvering, all eyes now turn to how China—and corporate America—responds in the coming weeks.
