President Donald Trump’s trade war has sparked a sell-off on Wall Street, with the S&P 500 falling 10% below its record high for the first time since 2023. The Dow Jones Industrial Average dropped 537 points, or 1.3%, while the Nasdaq composite fell 2%. The decline is attributed to uncertainty over the impact of Trump’s tariffs on the economy and his threat to impose 200% tariffs on European wines.
Investors are worried about the potential for stagflation, where economic growth stagnates but inflation remains high due to tariffs. A report showing mild wholesale inflation last month was not enough to offset concerns about the tariff war. Instead, it has raised fears that consumers may cut back on spending, which could have a negative impact on the economy.
Despite some positive economic indicators, including fewer U.S. workers applying for unemployment benefits and a weaker-than-expected inflation rate, investors are focused on the uncertainty surrounding Trump’s policies. The stock market is highly volatile, with stocks like Palantir Technologies and Super Micro Computer falling significantly due to concerns about their prices.
In contrast, Intel jumped 14.6% after naming former board member Lip-Bu Tan as its new CEO, which could bring stability to the company. The Dow Jones Industrial Average dropped 537.36 points to 40,813.57, while the Nasdaq composite sank 345.44 to 17,303.01.
The bond market also showed a decline, with Treasury yields losing an early gain to sink lower. Despite this, few predict a recession, but recent reports have shown a decrease in consumer confidence and company optimism.
Source: https://apnews.com/article/stocks-markets-rates-tariffs-1c8e59d6f2661c6e3c6aeda8ab07a583