Stock market correction
World stock indexes showed significant declines on Thursday, and the S&P 500 index officially entered a correction phase. Investors worried about the possibility of rising inflation and a slowdown in economic growth due to the escalation of trade conflicts began to switch en masse to safer assets, including US Treasuries.
For the first time since February 19, the S&P 500 (.SPX) closed more than 10% below its record level. This was a signal to market participants about serious risks associated with the US global trade policy.
New tariff offensive by Trump
Additional concerns among investors were caused by fresh statements by Donald Trump. The US President announced his intention to impose 200% tariffs on imports of European drinks if the EU does not abandon surcharges on American whiskey. This announcement came immediately after his new tariffs on steel and aluminum, which apply to all imports of these metals into the US, took effect.
Weak economic signals
Data from the US Department of Labor, released on Thursday, showed an unexpected stagnation in producer prices (CPI) in February. At the same time, statistics on Wednesday showed that the pace of growth of consumer prices was lower than expected.
Despite this temporary "respite" in inflationary pressures, market participants are not relaxing. Investors continue to consider the long-term risks associated with tariff wars and are bracing for a possible hit to economic growth in the coming months. Stock markets under pressure. Investors are looking for safe assets. Trade wars are gaining momentum. What will this mean for the global economy?
Major Wall Street indices are losing ground
US stock markets were under pressure again on Thursday. The S&P 500 (.SPX) fell by 1.39%, losing 77.78 points and ending the day at 5521.52. This drop was further confirmation that the US market is undergoing a correction.
The Dow Jones Industrial Average (.DJI) was also in the risk zone, falling by 1.30% (minus 537.36 points) to 40,813.57. This means that it is about 9.4% below its latest all-time high.
The tech-heavy Nasdaq Composite Index (.IXIC) took an even bigger hit. It fell 1.96%, losing 345.44 points, and closed at 17,303.01. Since the beginning of March, the Nasdaq has already lost more than 14%, which officially confirms it in the correction phase.
The Stock Market and Correction Cycles
History shows that correction movements in the stock market are far from uncommon. According to a Reuters analysis based on Yardeni Research data, the S&P 500 index has experienced 56 corrections since 1929. However, only 22 of them led to the formation of a bear market (i.e. a decline of 20% or more from the previous record high).
Global stock markets under pressure
The negative trend has affected not only the American indices, but also the global market. The MSCI World Stock Index (.MIWD00000PUS) fell 1.12%, losing 9.33 points to close at 821.52. It is now more than 7% below its most recent record high and hit its lowest level since September last year.
European markets were also unable to avoid falling. The pan-European STOXX 600 index (.STOXX) showed a slight decline of 0.15%, although it gained 0.81% during the previous trading session.
What's next? Investors await further signals
Markets continue to react to US trade tensions, high volatility and a possible slowdown in global economic growth. The question is whether the current correction will develop into a full-scale bearish trend or investors will soon see a recovery.
Record Highs Amid Trade Turmoil
Gold prices hit all-time highs on Friday, driven by growing economic uncertainty, escalating trade tensions and expectations of further easing by the US Federal Reserve.
Spot gold settled at $2,984.71 an ounce by 07:01 GMT, down 0.1% from a record high of $2,993.80. Investors are keeping a close eye on the price as bullion hovers close to the key psychological mark of $3,000.
Despite the slight correction, the precious metal continued to rise for the second week in a row, adding 2.5% over the period. US gold futures also strengthened, rising 0.2% to $2,997.50.
The EU's retaliatory strike and new tariff threats
The US-initiated trade war is gaining momentum. In response to Washington's increased tariffs on steel and aluminum imports, the European Union announced a 50% tax on American whiskey.
Donald Trump was quick to respond: via his social network Truth Social, he threatened to impose 200% tariffs on European wines and spirits. This statement caused additional nervousness in financial markets and increased demand for safe assets, including gold.
The $3,000 barrier: reality or speculation?
Experts note that the $3,000 per ounce level is becoming not just a psychological benchmark, but a key point for future price movements. According to analyst Rong, in the face of growing uncertainty in the markets, gold remains one of the few reliable assets, especially given the possible new round of trade restrictions in the second quarter.
Inflation and economic instability fuel price growth
The introduction of new tariffs is expected to not only exacerbate the trade standoff, but also increase inflationary pressure. This creates ideal conditions for further growth in gold prices, which have already updated historical maximums several times in 2025.
A safe haven asset in an era of instability
Gold is traditionally perceived as a reliable hedging instrument during periods of political uncertainty and inflation risks. In the context of escalating trade conflicts and instability in stock markets, demand for the precious metal remains high, strengthening its position as a key safe haven asset.
Focus on the Fed: the market awaits decisions
The main factor that can influence the further dynamics of gold prices remains the upcoming meeting of the US Federal Reserve, scheduled for Wednesday. The regulator is expected to keep the key interest rate in the range of 4.25% - 4.50%, which is in line with analysts' forecasts.
Markets are closely watching the Fed's rhetoric, as the central bank's next steps could determine borrowing costs and investment strategies for the coming months. Since gold does not generate interest income, its quotes tend to show gains in an environment of low interest rates and a weaker dollar.
Other precious metals: mixed movements
Amid the rise in gold quotes, other precious metals are showing mixed dynamics.
- Silver continued to rise modestly, adding 0.2% to reach $33.86 per ounce;
- Platinum, on the other hand, corrected, losing 0.3% and is trading at $991.34;
- Palladium was among the leaders of growth, rising 0.7% to $964.45.
Investors keep an eye on the Fed. What will happen to the precious metals market if the regulator changes monetary policy?
