Recession fears grow as Trump’s tariffs force share prices to hit levels not seen since the financial crisis

ARE we heading for a recession — and why?

Panic has gripped financial markets amid fears President Trump’s tariffs will trigger a global recession.

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Panic has gripped financial markets amid fears President Trump’s tariffs will trigger a global recession[/caption]

Reuters

The flashing red lights of tumbling share prices are a warning about investors’ views on the economy[/caption]

Stock markets can often seem separate to everyday life and the real economy.

However, the flashing red lights of tumbling share prices are a warning about investors’ views on the economy.

They have tanked because traders are betting Trump’s trade wars will damage companies’ profits and make them unlikely to invest, hire or expand.

The knock-on will be job cuts, which will lead to weakened consumer confidence and depress spending.

Larry Fink, boss of Blackrock, the world’s biggest asset manager, suggested the US may already be in recession and said the economy was “weakening”.

Analysts at Wall Street bank JP Morgan have estimated a 60 per cent chance of a global downturn while rival bank Goldman Sachs has started a “countdown to recession” and given it a 45 per cent probability.

Shares in banks, including HSBC and Barclays, have plunged by levels not seen since the financial crisis.

Similarly, commodity prices including copper and oil have slumped by 15 per cent as investors bet on lower global demand in the event of a recession.