Title: "Trading Manual on April 2nd: Three Possible Scenarios"
Author: Zhao Ying, Wall Street Insights
As the US tariff policy on April 2nd is about to be revealed, market uncertainty will reach a new peak, and investors need to fasten their seatbelts and prepare for volatility!
According to CCTV News on Saturday, on March 28th local time, US President Trump plans to announce new tariffs in the coming days. He stated that he is somewhat open to reaching tariff agreements with other countries, but hinted that any agreement would be reached after the tariff measures take effect on April 2nd.
When asked if this would happen before the tariff announcement on April 2nd, he said: "No, likely later." Trump also reiterated his plan to announce drug tariffs but refused to disclose the specific tax rates.
Citi's latest report summarized three main scenarios and their market impacts: first, announcing only reciprocal tariffs, which would have a relatively limited market reaction; second, reciprocal tariffs plus VAT, where the dollar index could immediately rise 50-100 basis points and global stocks might fall; third, including industry-specific tariffs in addition to reciprocal tariffs and VAT, which could trigger a more intense market reaction.
After the S&P 500 experienced its worst first quarter since 2020, analysts have widely warned that the potential for further decline is greater than potential gains. Some analyses indicate that future tariffs and retaliatory actions are key, and the market reaction on "April 2nd" will largely depend on the timing of tariffs, especially industry tariffs and the speed of other countries' responses to reciprocal tariffs.
