U.S. stocks after the worst quarter since 2022 amid tariff horror

Good morning, I’m back to Firstft Asia. In today’s newsletter:

US stocks suffer from a sharp pullback in the first quarter

Japan’s earthquake warning

Is Iran on a collision course with the West?

Wall Street stocks recorded the worst quarter in almost three years, fearing that Donald Trump’s tariffs would lead to male dog periods in the world’s largest economy.

What’s going on: The S&P 500 fell 4.6% in the first three months of 2025. This is the worst performance since the third quarter of 2022. The Blue Chip Index rose 0.6% yesterday. Investors are supporting themselves for Trump’s “liberation day” event tomorrow. The US President is expected to announce fresh tariffs in addition to existing taxes on imports of goods such as steel and aluminum.

What to expect: Sharon Bell, senior equity strategist at Goldman Sachs, said “I’m not necessarily looking at the floor (at the stock price).” Over the weekend, Goldman said he expects a 35% recession from next year, from 20% earlier.

Global response: European stocks outperformed the US with a significant shift from 2023 and 2024, when Wall Street passed its rivals. Asian markets mixed in the quarter, with Japan’s Topix sliding 4.5% and China’s CSI 300 slipping 1.2%, while Hong Kong’s Hansen jumped 15% and South Korea’s Kospi rose 3.4%.

“It’s the overall (that is) uncertainty that emphasizes investor sentiment,” said Charles de Boissezon, global head of equity strategy at Société Générale. “While the (customer) announcements continue to change, what they have in common is that (they) are not suited to growing globally.”

For more information on uncertainty about customs fuels in the market, please see here.

And here’s the other thing we keep tabs today:

Economic Data: Australia reports retail figures for February, while Japan publishes its labor force survey for the month.

Monetary Policy: The Reserve Bank of Australia is expected to hold interest rates steady when the central bank announces its decision today. (Yahoo Finance)

Leadership Change: Ivan Espinosa will become Nissan CEO, while Sony’s President Tao will take on the role of CEO of the Japanese technical conglomerate.

Five more top stories

1. Japan’s long-standing “big” earthquake could kill around 300,000 people along the urbanized Pacific coast, new government forecasts warn. The report said the magnitude-9 earthquake in the Nanjing trough could cause economic damage of 1.8 tons, which amounts to about half the country’s annual GDP.

2. The US has imposed sanctions on Chinese and Hong Kong higher education officials to reduce cross-border oppression and territorial autonomy. Washington has placed sanctions on six officials, including a Hong Kong police commissioner, in response to China’s crackdown on territorial democratic activists.

3. One of Japan’s most prominent shareholder activists has accused Nippon Steel of hurting minority investors in one of its largest subsidiaries as steelmakers are trying to drive politically a $15 billion acquisition agreement in the US. 3D Investment Partners has built around 10% stake in IT Services Group NS Solutions, pushing Nippon Steel to grant far more independence to its subsidiaries.

4. French far-right leader Marine Le Pen was sentenced to prison after being convicted of embezzling EU funds after being banned for five years from office for five years. The court’s ruling, which analysts described as “a major turning point in French political life,” is likely to prevent Le Pen from running in the 2027 presidential election. Le Pen vowed to appeal to the verdict.

5. Sales at one of China’s biggest real estate developers fell more than a third of last year as they struggled to come out of their fourth year slowdown. The poor sales at the country gardens was the group’s biggest annual decline since the national property crisis began in 2021 with the collapse of developer Evergrande.

Big reading

Seven years ago, Trump strictly restricted nuclear activities and tore up an agreement with Iran, which had been supported by Europe, Russia and China. The president is now facing impacts as Tehran actively expands its nuclear activity and is trapped in a collision course with the West, which is scheduled to come at the beginning of this year.

We’re reading too. . .

The chart of the day

China targeted record numbers of conflicts at the World Trade Organization last year as the country’s booming exports overwhelmed international markets and sparked objections from commercial partners. The new study showed that Beijing accounted for almost half of all conflicts submitted to the World Trade Organization in 2024.

Take a break from the news. . .

Don’t miss this heartburn-inducing story of FT’s Southern Corn correspondent Ciara Nugent about the quest for the glory of Argentinian pizza.