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financial graphic illustrating market declines due to tariffs.
UPDATED Selective US

U.S. Stock Markets Tumble as Trump Threatens China with 100% Tariffs

Markets Plunge on Trump China Tariff Threat

Major U.S. stock indexes suffered sharp losses Friday after President Trump threatened 100 percent tariffs on China, wiping 2 trillion dollars from markets.

  • Trump threatens China with 100 percent tariffs after close
  • Stock markets plunge 2 to 4 percent on Friday
  • Government shutdown enters second week with no resolution
  • Congress deadlocked over spending as services remain disrupted
  • Third quarter earnings season begins week of October 14
  • Banking giants JPMorgan and Wells Fargo report first
  • Key economic data delayed due to federal agency closures
  • Investors brace for trade war and market volatility ahead

U.S. stock markets closed sharply lower on Friday, October 10, 2025, after President Donald Trump threatened massive new tariffs on China, wiping out more than 2 trillion dollars from market value in a single trading session.[1][2] The sell-off reversed earlier gains and marked the largest single-day percentage drops for the S&P 500 and Nasdaq since April 10, 2025.[3]

Market Performance and Index Losses

The three major indexes all suffered steep declines on Friday. The Dow Jones Industrial Average fell 1.90 percent, the S&P 500 dropped 2.71 percent, and the Nasdaq Composite plunged 3.56 percent.[3] The Nasdaq had briefly touched a fresh record high during morning trading before reversing course after the tariff announcement.

Stock futures remained under pressure heading into the weekend. As of 4:59 p.m. EDT on October 10, Dow Jones futures were down 1,133 points or 2.43 percent to 45,475. Nasdaq 100 futures fell 1,099.25 points or 4.35 percent to 24,188. S&P 500 futures declined 227.75 points or 3.36 percent to 6,552.[4]

Tariff Announcement Impact

President Trump announced plans to impose what he described as 100 percent tariffs on China after the market close on Friday.[5][6] The tariff threat sent shockwares through global markets and raised fresh concerns about trade policy instability and its impact on corporate earnings and economic growth.[2]

Investors are now bracing for potential retaliatory measures from China and the broader economic implications of renewed trade tensions between the world’s two largest economies.

Government Shutdown Enters Second Week

The U.S. government shutdown officially entered its second week as of October 11, 2025, with Congress remaining deadlocked over spending proposals.[7][8] The shutdown began on October 1 due to an impasse between congressional Republicans and Democrats over a spending bill.[8]

More than a week into the shutdown, negotiations show no signs of progress. Hundreds of thousands of federal employees have been furloughed or are working without pay. Non-essential government services remain disrupted, and key economic reports continue to be delayed.[8]

Economic Data Disruption

The prolonged shutdown is preventing the release of crucial economic data that investors and policymakers rely on for decision-making.[8] Federal agencies responsible for publishing employment reports, GDP figures, and other economic indicators remain closed.

Washington, D.C. tourism has been particularly hard hit, with Smithsonian museums closed during what is typically a peak season for conferences and business travel.[7] The ongoing stalemate raises concerns about potential impacts on Federal Reserve policy decisions and broader economic growth.

Third Quarter Earnings Season Launches

Despite market volatility and government dysfunction, corporate earnings season for the third quarter of 2025 is set to begin in earnest during the second week of October.[9] Major banking giants are scheduled to lead off the reporting period.

Key Earnings Dates

JPMorgan Chase, Citigroup, and Wells Fargo are expected to report results during the week of October 14.[9] Goldman Sachs is scheduled for Monday, October 13, while Bank of America will follow on Tuesday, October 14.[9]

Additional major companies reporting in the coming weeks include 3M Company, Philip Morris International, Verizon Communications, AT&T, IBM, and Tesla.[9] Analysts at FactSet estimate year-over-year earnings growth of 7.9 percent for S&P 500 companies, which would mark the ninth consecutive quarter of earnings growth for the index.[9]

Market Outlook and Investor Concerns

The confluence of escalating trade tensions, government shutdown disruptions, and the start of earnings season creates a challenging environment for investors heading into the second half of October 2025.[1][2][3]

Market participants will closely watch corporate earnings reports for signs of how companies are navigating the current economic and political uncertainties. The absence of government economic data due to the shutdown makes corporate guidance even more critical for assessing economic health.[8]

Investors also remain focused on potential Federal Reserve actions, though the lack of official economic data complicates the central bank’s ability to make informed policy decisions.[8] The combination of these factors suggests continued market volatility in the near term.

Rachel Patel

Rachel Patel

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Rachel Patel is a senior news editor and journalist specializing in political journalism and digital media. With over seven years of professional experience, she is recognized for her accuracy, source verification, and audience-focused reporting approach. Rachel earned her M.S. in Journalism & Media Studies from Stanford University (2018), where she developed expertise in media ethics, political communication, and digital storytelling. Her career has centered on bridging traditional political reporting with the fast-paced world of online journalism. She has contributed to major global media outlets, analyzing how digital platforms — from YouTube and Reddit to TikTok and Bluesky — shape political narratives, influence public opinion, and redefine news consumption. Now based in Berlin, Germany, Rachel serves as a Senior News Editor at Faharas NET, leading coverage on digital politics, media literacy, and social communication trends in the modern information landscape.

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Editorial Timeline

Revisions
— by Elena Voren
Add SEO improvements
— by Kamar Mahmoud
Featured image added to article
— by Nodin Laramie
  1. Article completely rewritten with October 11, 2025 data
  2. Updated all stock market statistics and futures data from October 10, 2025
  3. Replaced record rally narrative with tariff-driven sell-off coverage
  4. Updated government shutdown timeline to second week status
  5. Revised earnings season dates and companies to Q3 2025 schedule
  6. Added 10 authoritative sources with proper citations
  7. Restructured with H2/H3 headings for SEO optimization
  8. Completed all FAQ questions with current information
  9. Updated TL;DR summary and key points to reflect market downturn

Correction Record

Accountability
— by Nodin Laramie
  1. Corrected article headline from stable futures to market tumble reflecting actual October 10 events
  2. Updated opening paragraph from record rally narrative to 2 trillion dollar market loss
  3. Corrected Dow futures from +0.19% to -2.43% (October 10, 2025 data)
  4. Corrected Nasdaq futures from +0.11% to -4.35% (October 10, 2025 data)
  5. Corrected S&P 500 futures from +0.2% to -3.36% (October 10, 2025 data)
  6. Replaced outdated October 5 data with October 10-11, 2025 information
  7. Corrected earnings season companies from Constellation Brands and Levi Strauss to JPMorgan Chase and Wells Fargo
  8. Updated government shutdown status from initial phase to second week
  9. Corrected market performance narrative from weekly gains to single-day massive losses

FAQ

Why did stock markets drop so sharply on October 10, 2025?

President Trump announced plans to impose 100 percent tariffs on China after market close, triggering massive sell-offs. The S&P 500 fell 2.71 percent and Nasdaq dropped 3.56 percent, erasing more than 2 trillion dollars in market value in the largest single-day percentage decline since April 10, 2025.

How long has the government shutdown lasted and what is the impact?

The government shutdown began October 1, 2025, and officially entered its second week as of October 11, 2025. Congress remains deadlocked over spending proposals with no resolution in sight. Hundreds of thousands of federal employees are furloughed or working without pay, key economic reports are delayed, and non-essential services remain disrupted.

When does third quarter earnings season begin and which companies report first?

Third quarter earnings season begins in earnest during the week of October 14, 2025. Major banking giants lead off the reporting period, including JPMorgan Chase, Citigroup, and Wells Fargo. Goldman Sachs reports Monday, October 13, followed by Bank of America on Tuesday, October 14. Additional companies reporting include 3M, Philip Morris, Verizon, AT&T, IBM, and Tesla.