Global markets have been shaken by the protectionist trade policies of US President Donald Trump. Stock markets, cryptocurrencies, oil, natural gas, and many financial products experienced significant declines. Here are the answers to the questions raised about the tariff uncertainty destabilizing the markets…The increased risk perception following the reciprocal tariff measures announced by US President Donald Trump in line with his protectionist trade policy continues to shake global equity markets. While Trump’s tariff announcements remain a source of uncertainty, the retaliatory actions taken and to be taken in this regard are keeping the risk perception high.On the first day of the week, there was a deep selling pressure in global equity markets, with the selling pressure starting from Asia and continuing in other stock exchanges as well. In Japan, the Nikkei 225 index closed at 31,187 points with a 7.7% decline, while in South Korea, the Kospi index dropped by 5.6% to 2,328 points. In China, the Shanghai Composite Index closed at 3,096 points with a loss of 7.3%, and in Hong Kong, the Hang Seng index closed at 19,828 points with a 13.2% loss.Parallel to the Asian stock markets, European markets also started the day on a downward trend. In Europe, about 97% of the companies listed in the Stoxx 600 saw their stock prices decline. In Germany, the loss in the DAX 40 index reached 7.1% after the opening, while in France, the CAC 40 index dropped by 6.3%, in the UK, the FTSE 100 index decreased by 5.1%, and in Italy, the FTSE MIB 30 index lost 7.4%.Here are 5 questions and answers about the tariff uncertainty causing the mentioned sales: After US President Trump’s election for a second term on November 5, 2024, and beginning his term on January 20, 2025, the global trade strategy of the US changed to become more protectionist.Trump’s promise to reduce the trade deficit during his candidacy period led investors to be preoccupied with tariff statements. Following January 20, consecutive tariff statements fueled risk perception in global markets. The repeated tariff statements often became the main agenda of markets and asset pricings.For markets, President Trump’s tariff statements brought up the issue of additional price increases in products. The increase in prices of products imported to the US from abroad is aimed at decreasing demand, thus lowering the trade deficit, and concurrently encouraging domestic production. This price movement fundamentally affects the manufacturing and trade strategies of countries and companies. Many US companies producing overseas will face additional customs duty expenses after tariffs, triggering changes in the future outlooks of all companies and countries. Changing conditions, particularly led by central banks, increase uncertainties in the global economic outlook.Last week, the reciprocal tariffs declared by the US administration aim to significantly reduce the trade deficit with its trading partners. The US trade deficit reached a record level of $130.7 billion in January. According to the latest data, the US trade deficit with the European Union (EU) was $30.9 billion in February, and with China, it stood at $26.6 billion.Last week, under the executive order signed by Trump, tariffs ranging from 10% to 50% were imposed on goods imported from many trading partners. Accordingly, the EU faces a 20% tariff, China 34%, Vietnam 46%, Taiwan 32%, Japan 24%, India 26%, South Korea 25%, Thailand 36%, Switzerland 31%, Indonesia 32%, Malaysia 24%, Cambodia 49%, South Africa 30%, Bangladesh 37%, and Israel 17%.The consecutive tariff announcements by the US are making it difficult to forecast the global economy, while forthcoming retaliation announcements from countries strengthen predictions that trade wars could escalate. The significant impact of tariffs on centers such as China, Vietnam, and Taiwan that have different advantages like cheap labor, logistics, and advanced manufacturing infrastructure is causing high levels of risk perception in all stock markets, especially in the indices of those countries.After Trump announced reciprocal tariffs after US markets closed on Wednesday, April 2, 2025, the selling wave that started in Asian stock markets on Thursday deepened and continued. As markets opened the new week, the selling trend intensified and spread to all major indices.Countries’ 5-year credit default swap rates increased during this period, while investors turning to safe-haven assets led to an increase in global bond demand. Bond yields decreased significantly worldwide. Similar market movements were observed in the sales pressure caused by global recession concerns in August 2024.