Stock market dips amid new tariffs: What it could mean for Oklahomans

Stock markets worldwide are careening even lower Friday after China matched President Donald Trump’s big raise in tariffs in an escalating trade war. Not even a better-than-expected report on the U.S. job market, which is usually the economic highlight of each month, was enough to stop the slide.

The S&P 500 was down 4.8% in afternoon trading, after earlier dropping more than 5%, following its worst day since COVID wrecked the global economy in 2020. The Dow Jones Industrial Average was down 1,719 points, or 4.3%, as of 1:08 p.m. Eastern time, and the Nasdaq composite was 4.9% lower.

The above information is courtesy of the Associated Press.

News 9 spoke with Steve Wyett, chief investment strategist for Tulsa-based BOK Financial, about how this could impact Oklahomans.

RELATED: Financial strategist urges Oklahomans not to panic as stock market dips

What does the stock market dip mean for the average person?

Experts say that while the drop may be unsettling, this level of market volatility is not unusual and does not indicate a crash or financial emergency. Fluctuations like these are part of investing, and solid investment plans take them into account. While credit spreads have widened slightly, officials say there is no sign of financial stress in the markets.

What items will increase in price due to tariffs?

It’s difficult to predict exactly when and how much prices will rise, as it depends on the product, the company, and where the item is imported from. President Trump’s recent tariffs are significant, with Vietnam facing up to a 46% tariff and China’s imports taxed at nearly 60-70%.

Some companies, such as Apple, plan to absorb the costs rather than raise prices. Apple’s profit margins allow for this, but for products with smaller margins, consumers may feel more of an impact. Experts estimate the Consumer Price Index (CPI) could rise by 1-2%, though several factors could affect that number.

What are the potential upsides to these tariffs?

In the short term, higher tariffs could lead to increased prices, making everyday goods more expensive for consumers. However, the administration argues that the long-term goal is to boost U.S. production and jobs.

The tariffs also put pressure on Congress to extend tax cuts and provide offsets, such as eliminating taxes on tips, overtime, or Social Security. The idea is that accepting higher prices now could lead to a more resilient economy with more domestic manufacturing and job growth. Inflation has outpaced wage gains since the pandemic, though recent months have seen wages growing faster than inflation. With tariffs in place, inflation may rise again, but the administration is betting that short-term challenges will lead to long-term economic benefits.

When will we know if prices will go down?

Officials are hoping to see results in six to nine months.