Wall Street experienced significant losses this week, marking its worst performance since the beginning of the COVID-19 crisis in March 2020. The downturn comes as President Donald Trump implemented sweeping tariffs aimed at overhauling the US trade policy framework, a move that investors have met with skepticism and unease.

On Friday, the S&P 500 index fell by 322 points, equivalent to a 6% decline, while the Dow Jones Industrial Average decreased by 2,231.07 points, or 5.2%.

This decline has resulted in a total loss of approximately $6.4 trillion in market value in just two days.

The Nasdaq Composite index also sank 5.8%, entering bear market territory, defined as a 20% drop from its peak in December 2022. Throughout the week, the S&P 500 lost 9.1%, marking its worst five-day trading stretch since March 2020.

President Trump reaffirmed his commitment to the tariff strategy via a post on social media, promising, "ONLY THE WEAK WILL FAIL!" However, this declaration failed to alleviate investor anxiety surrounding the proposed tariffs.

China has announced plans to retaliate, setting the stage for a potential trade war between the US and the world's second-largest economy.

Trump's package of tariffs includes a baseline 10% tariff on all imported goods, with increased rates for countries like China and members of the European Union.

The tariffs are set to begin on April 5, with the reciprocal tariffs targeting nations with which the US has trade deficits.

Reports indicate that Trump finalized the plan just hours before its announcement, further adding to the uncertainty felt in financial markets.

The British FTSE 100 index fell 5% amid the sell-off, while the CAC 40 in France dropped 4.3%, and the Nikkei 225 in Japan decreased by 2.8%.

Federal Reserve Chair Jerome Powell cautioned that these tariff increases would likely lead to higher inflation and slower economic growth.

Global markets, unsettled by the prospect of increased trade barriers, have seen a pronounced impact since the tariffs were proffered.

In the US, the Dow Jones index plummeted over 1,680 points in a single day, prompting calls for a reconsideration of trade policies.

Internationally, reactions have been mixed but largely negative.

European leaders expressed their concern regarding the implications of the tariffs, with EU Commission President Ursula von der Leyen labeling them as a significant blow to the global economy.

Lawmakers from countries affected by the tariffs have also signaled potential retaliatory measures, aiming to mitigate the adverse effects on their own economies.

In Australia, the stock market witnessed a sharp decline, with the S&P/ASX200 losing 191.9 points, or 2.44%, in reaction to the developments, resulting in significant market capitalization loss.

Notably, the tariffs are also affecting supply chains globally, with widespread uncertainty regarding future trade relations.

Economists predict that the aggressive tariff strategy may exacerbate existing economic challenges in the US, with some forecasting an increased likelihood of recession by year-end.

As the situation unfolds, market analysts remain on high alert as they monitor developments in trade policy and international relations.