Global stock markets traded sharply lower on Thursday morning as investors crowded into safe haven assets in response to Donald Trump’s harsher than expected US tariff measures.

Late on Wednesday Trump finally revealed details of levies imposed on global goods imports, with the President’s ‘liberation day’ announcements promising to kick start a new golden age for US industry.

South East Asian trading partners were hardest hit, with levies ranging from 24 per cent on Japanese goods to an eye-watering 49 per cent on Cambodian goods, while the European Union will face a 20 per cent tariff.

All countries were already hit with 25 per cent tariffs on auto imports last week. 

The UK looks to have gotten off relatively lightly with the 10 per cent baseline levy imposed on all countries, but analysts warn the tariffs will still weigh heavily on exporters – as well as economic growth.

The FTSE 100, which fell 0.3 per cent in the previous session, slumped 1.3 per cent in early trading, led by declines in Mondi, Standard Chartered, Barclays, JD Sports and Anglo American with losses of more than 4.5 per cent each.

Levy: Britain’s diplomatic push has not spared the country from Trump’s tariffs

The FTSE 250 was down 1.4 per cent with retail brands like Watches of Switzerland and Doctor Martens among the worst affected.

Emma Rowland, trade policy advisor at the Institute of Directors, said the tariffs are a ‘blow to British business’, highlighting the automotive, pharmaceutical, chemicals and whiskey industries as particularly vulnerable.

‘Exporters to the US will be forced to review the viability of the US as a destination for their goods, and as a supply chain location. 

‘Alternatively, they may well have to reduce their profit margins to remain competitive.’

Trump has already imposed tariffs on auto imports – and British car manufacturers face an even harsher rate than the blanket 10 per cent imposed on other exporters.

Business minister Jonathan Reynolds told Times Radio on Thursday morning that tariffs present a ‘threat’ to the country because of their impact on global trade. 

He added: ‘Anything that disrupts the global trading system is a threat to the UK.’

Asian markets, which were hit with much harsher levies, fell sharply, with Japan’s Nikkei and Hong Kong’s Hang Seng sliding 2.8 and 1.5 per cent respectively.

Germany’s DAX is down 2.1 per cent, France’s CAC 40 is off 1.8 per cent and the broader STOXX Europe 600 has lost 1.5 per cent.

US markets also look set to open lower, with S&P 500 futures down more than 2 per cnet from Wednesday’s open.

Gold climbed as high as $3162.72/oz late on Wednesday as tariff details emerged, but has given back some ground to trade at $3,125.14/oz at market open in London.

Government bonds have also broadly rallied, with yields falling by 5 to 10 basis points on US, UK, German and Japanese debt.

The US dollar is trading 0.5 per cent lower against the pound and 0.6 per cent lower against the euro.

Analysts at ING said: ‘Markets did not like the list of tariffs Trump presented yesterday, and the numbers appear worse than feared.

‘We think markets will predominantly focus on the growth impact for now, warranting downward pressure on euro rates.

‘Even if Trump decides to reduce the eventual percentages as negotiations take shape, the uncertainty and confidence shock are enough to weigh on the economy with immediate effect. 

‘Inflation, on the other hand, is difficult to quantify and will take more time to show up in the data.’

How do the tariffs measure up? 

DIY INVESTING PLATFORMS

AJ Bell

AJ Bell

Easy investing and ready-made portfolios

Hargreaves Lansdown

Hargreaves Lansdown

Free fund dealing and investment ideas

interactive investor

interactive investor

Flat-fee investing from £4.99 per month

Saxo

Saxo

Get £200 back in trading fees

Trading 212

Trading 212

Free dealing and no account fee

Affiliate links: If you take out a product This is Money may earn a commission. These deals are chosen by our editorial team, as we think they are worth highlighting. This does not affect our editorial independence.

Compare the best investing account for you