US President Donald Trump announced fresh 100% tariffs on Chinese imports on October 10, 2025, pushing total duties to 130% and sending shockwaves through global stock markets.
Wall Street saw its worst day since April, with the S&P 500 dropping 2.7%, while London’s FTSE 100 closed down 0.9% at 9,427.47.
The move, a response to China’s rare earth export controls, threatens supply chains for tech, EVs, and defense, hitting Europe and the UK hard.
Investors fear inflation and trade wars as the UK economy braces for higher costs, with experts warning of slower growth.
This escalation grips traders in Europe and the UK as of 10:45 AM IST today, Saturday, October 11, 2025.
Tariff Details and Trump’s Rationale
Trump’s order, effective November 1, 2025 (or sooner if China acts), adds 100% to existing tariffs on key Chinese goods like semiconductors, EVs, wind turbines, and pharmaceuticals.
He called China’s rare earth restrictions “unprecedented” and a “moral disgrace,” accusing Beijing of targeting the world with “large-scale export controls.”
Rare earths, vital for AI chips, clean energy, and military tech, make up 80% of global supply from China.
Trump also canceled an APEC summit meeting with Xi Jinping, saying, “There seems no reason to do so.”
The White House eyes “many other countermeasures,” including software export bans.
This builds on Trump’s 2018 trade war, where tariffs averaged 2.5% before rising to 18% by 2025.
Analysts like Oliver Allen from Pantheon Macroeconomics note the timing coincides with a US government shutdown, delaying economic data and adding uncertainty.
Immediate Market Reactions
US markets plunged: S&P 500 fell 2.7%, Dow Jones 1.2%, Nasdaq 2.2%, erasing weekly gains.
Tech stocks like Nvidia and Apple dropped 3-5% on supply chain fears.
Europe’s CAC 40 and DAX 40 both lost 1.5%, with London’s FTSE 100 down 81.93 points (0.9%) to 9,427.47.
FTSE 250 fell 1.1% to 21,801.84, AIM All-Share 0.9% to 786.33. Weekly losses: FTSE 100 -0.7%, FTSE 250 -1.8%.
In the UK, Compass Group rose 0.9% on a Bank of America “buy” rating, Sage Group 1.4% on Citi’s upgrade, but Entain plunged 33.2p (-4.0%) on weak demand, Mondi 30.2p (-4.0%), and Shell 80.5p (-2.5%). B
rent oil dipped to $63.19/barrel, gold hit $4,014.76/ounce. The pound rose to $1.3338 vs dollar, euro to $1.1616.
Impacts on UK and Europe
The tariffs threaten UK exports to China, worth £20bn yearly in goods like machinery and pharma.
GTRI warns no US deal is “ever final,” urging India (and by extension UK/Europe) to prioritize self-reliance in minerals.
UK wholesale inflation fell 0.1% in August, but tariffs could reverse this, raising costs for EVs, semiconductors, and renewables—key to net-zero goals.
J.P. Morgan cuts eurozone growth to 1.4% in Q4 2025 from 2.1%, citing tariffs. EU faces steeper hits, with 10% minimum tariffs, up to 100% for China/India oil to pressure Russia.
For India, tariffs mean higher EV/wind turbine prices, but opportunities in “friend-shoring” to Vietnam/Australia.
China may redirect rare earths to BRICS partners, reshaping trade.
UK Chancellor Rachel Reeves called for “give and take” to avoid US tariffs, but experts like Dr. Jonathan Owens warn of inflation from supply shocks.
Expert Views and Broader Context
Trump’s tariffs aim to “protect American jobs,” but critics say they backfire, costing US households $1,300 yearly in 2025.
Global GDP growth dips to 3% in 2025 from 3.3%. In the UK, Barclays raised S&P 500 target to 6,450 on AI optimism, but tariffs cloud this.
Elon Musk urged Trump to reverse them, warning of economic fallout.
On X, reactions mix fear and criticism. One post read, “Trump’s China tariffs tank FTSE—UK economy next?” .
Another noted, “UK stocks spooked by Trump—FTSE drops amid US trade war” .
What to Watch Next
Markets reopen Monday with UK GDP/jobs data and China inflation. Trump’s APEC snub escalates tensions—expect EU/UK responses. Investors eye “friend-shoring” for stability.
Stay informed and tuned for market updates!