When the World Sneezed: How U.S. Tariffs Sparked Asia's Biggest Market Crash in Decades

Abstract

On April 7, 2025, Asian financial markets were engulfed in chaos as a massive stock market crash swept through the region, driven by escalating fears of a global trade war ignited by sweeping U.S. tariff policies under President Donald Trump. Major indices in China, Japan, India, Singapore, and Taiwan plummeted, marking one of the most severe single-day drops in decades. The crash erased trillions of dollars in market value, exposing deep vulnerabilities in Asia's export-driven economies and sparking widespread panic among investors. As trading floors from Shanghai to Singapore reeled, the day unfolded as a stark reminder of the fragility of global markets in the face of geopolitical upheaval, with analysts warning of a potential recession looming on the horizon.