US stocks plummeted Wednesday as Federal Reserve Chair Jerome Powell warned that President Donald Trump’s tariffs are unprecedented in modern history. The Dow tumbled 700 points, or 1.73%, while the S&P 500 fell 2.24%. The tech-heavy Nasdaq Composite dropped 3.07%.
Powell stated that the tariff increases announced so far are significantly larger than anticipated, with uncertain economic effects including higher inflation and slower growth. Trump’s trade war has left investors uncertain about policy changes.
The US-China trade battle has intensified since January, with restrictions on AI chip exports to China further fueling tensions. Nvidia fell 6.87% after the company announced a $5.5 billion hit due to these restrictions.
Analysts warn of continued uncertainty, with the prospect of recession rising as economic activity slows down. The US dollar index slid 0.8%, hitting its lowest level in three years.
Investors are watching for updates from the White House on trade policy developments. Goldman Sachs CEO David Solomon stated that the climate is “markedly different” and the prospect of a recession has increased due to market uncertainty.
Source: https://edition.cnn.com/2025/04/16/investing/us-stock-market/index.html