White House trade advisor says reciprocal tariffs "one country, one number," Nasdaq 100 likely to fall into adjustment range

Trump's trade advisor mentioned plans for reciprocal tariffs to be implemented a month later, while the U.S. stock market continued to decline.

On the morning of March 7th, Eastern Time, according to Sina News, during discussions about the reciprocal tariffs advocated by President Trump, White House Senior Trade and Manufacturing Advisor Peter Navarro stated, "One number for each country." Navarro also mentioned that as part of trade negotiations, automotive companies have committed to accelerating the transfer of their supply chains to the U.S. He believes that the Trump administration will bring positive supply-side shocks.

During Navarro's speech, the three major U.S. stock indices maintained their downward trend in the early trading session, with the Dow Jones Industrial Average down over a hundred points, and the S&P and Nasdaq down around 0.4%, further declining later, with the S&P and Nasdaq down over 1% and the Dow down over 400 points. The tech-heavy Nasdaq 100 index initially turned positive but then turned negative again during the early session, maintaining a downward trend, and by the end of the early session, it was down over 1%.

If the downward trend continues until the close, the Nasdaq 100 will have fallen more than 10% from its record high set on December 19 of last year, following the Nasdaq's entry into a technical correction zone on Thursday, it will also fall into the correction zone.

According to the People's Daily, on February 13th local time, President Trump signed a memorandum requiring relevant departments to determine "reciprocal tariffs" with each foreign trading partner. U.S. Secretary of Commerce Wilbur Ross stated that the research on this measure will be completed by April 1st, and the President can take action immediately thereafter.

Reports cited explanations from The New York Times and The Hill, stating that the new "reciprocal tariff" measures will not only consider the level of tariffs imposed by other countries on the U.S. but also take into account subsidies provided to domestic industries, exchange rates, and any actions deemed unfair by the U.S. For decades, the U.S. has set tariff levels through multilateral negotiations in international trade organizations such as the WTO, but now, the new tariffs may be determined entirely by U.S. officials based on their own standards.

The reciprocal tariff plan aims to increase federal revenue through upgraded trade protectionist measures, forcing companies to relocate production back to the U.S., boosting domestic industries and employment; it may also signal the start of negotiations aimed at forcing other countries to open their markets and make concessions. However, such a plan is likely to backfire.

Gary Hufbauer, a senior fellow at the Peterson Institute for International Economics and a former U.S. Treasury official, believes that "reciprocal tariffs" will lead to an increase in average U.S. tariffs by 10 to 15 percentage points, dragging down U.S. economic growth. U.S. economist and 2001 Nobel Prize winner Joseph Stiglitz stated that tariff policies have made the U.S. a "terrible place for investment," potentially triggering stagflation in the U.S.

Moreover, experts believe that the U.S. faces issues such as an aging power grid and infrastructure, and high education costs, making it difficult to ensure the necessary conditions for manufacturing to return. Forcing trade balance to achieve manufacturing repatriation will inevitably accelerate the trend of de-dollarization Analysis suggests that once the United States implements its "reciprocal tariff" policy, it will inevitably face countermeasures from multiple countries, increasing the risk of a trade war and bringing uncertainty to the global economy.

It is widely pointed out that Europe will be one of the main victims of the U.S. "reciprocal tariff," while Japan and other countries with regulatory measures and non-tariff barriers will also be primary targets. Developing countries will suffer the most severe impacts, especially India, Brazil, Vietnam, and other Southeast Asian and African nations.

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