WALL STREET TO WORLDWIDE: THE IMPACT OF US TRADE WARS ON GLOBAL STOCK MARKET PERFORMANCE

In the last ten years, the revival of protectionist trade policies—especially those initiated by the United States—has altered the landscape of global financial markets. This research explores the influence of U.S.-led trade conflicts, particularly those directed at China and the European Union, on stock market fluctuations across major global indices. Through a combination of empirical research and theoretical modelling, we highlight the channels through which uncertainty related to trade policies, tariffs, and retaliatory actions lead to increased market volatility. Our results indicate that announcements and escalations of trade wars act as significant triggers for spikes in volatility, with especially marked effects observed in emerging markets, economies reliant on exports, and sectors dependent on global supply chains like technology and manufacturing.