U.S. stock markets hit following President Trump’s announcement of new tariffs on key trading partners, with many tariff-sensitive stocks seeing increased volatility. Some traders have built “baskets” of tariff-sensitive stocks, allowing them to bet on the impact of trade policies across multiple companies. Hedge funds are shorting certain European stocks exposed to tariffs, such as Mercedes-Benz and BMW. Options market activity has surged, with traders seeking to hedge against rapid reversals or predict Trump’s next move. On Friday, zero-day options trading hit a record $1.4 trillion in notional value.