WHY IS THE MARKET CRASHING???
Previously, the market fell sharply due to random long positions being killed, wiping out 1.6 billion USD.
But this time, the crash has clearer reasons.
🔹 US economic signals: US GDP announced exceeded expectations → concerns that the Fed will delay interest rate cuts.
🔹 Two hot news this morning:
1. The SEC is preparing to investigate 200 DAT companies for suspected insider trading.
2. Trump announced a new tariff package effective from 10/1/2025:
• 30% tax on upholstered wood products, 100% on imported drugs (except for companies that open factories in the US).
• Additional taxes on kitchen cabinets, vanity cabinets, heavy-duty trucks.
• The White House is also considering expanding to robots, industrial machinery, and medical equipment.
📌 Actual impacts:
• Furniture, kitchen cabinets, and imported drugs are sure to increase in price → consumers will bear the brunt.
• Healthcare costs are escalating, unless pharmaceutical companies invest in domestic production.
• American farmers are affected due to the risk of trade retaliation. Trump promised to use tax money to support them, but this mechanism is still vague and could even be blocked by the Supreme Court.
👉 Clearly, Trump prioritizes domestic politics (farmers, jobs, Boeing) but creates more instability for international markets. In the pharmaceutical sector, this policy also provokes strong reactions domestically as it relates to essential goods.