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Dow Plunges 600+ Points, S&P 500 Sees Biggest Drop Since December as Trump Confirms Tariffs

 Stock Market Plunges as Tariff Concerns Weigh on Investors



Stock Market Plunges as Tariff Concerns Weigh on Investors

The S&P 500 tumbled on Monday, deepening February’s downturn and turning negative for the year following President Donald Trump’s confirmation of impending tariffs.

The broad market index dropped 1.76% to close at 5,849.72, marking its worst session since December and bringing its year-to-date losses to approximately 0.5%. The Dow Jones Industrial Average slid 649.67 points, or 1.48%, to settle at 43,191.24. Meanwhile, the Nasdaq Composite plummeted 2.64% to 18,350.19, dragged down by an 8% decline in Nvidia shares.

The market saw a sharp afternoon sell-off after President Trump reaffirmed that 25% tariffs on imports from Mexico and Canada would take effect Tuesday, dashing investor hopes for a last-minute agreement to prevent the levies. Earlier in the session, all three major indexes traded in positive territory, with the Dow reaching a session high of nearly 200 points.

“There is no room left for Mexico or Canada,” Trump stated alongside Commerce Secretary Howard Lutnick at the White House. “Reciprocal tariffs start on April 2 … but very importantly, tomorrow, tariffs—25% on Canada and 25% on Mexico—will commence.”

Additionally, Trump signed an order imposing an extra 10% duty on China, according to administration sources. The announcement triggered a broad risk-off sentiment, impacting sectors ranging from technology to small-cap stocks. Nvidia led losses among artificial intelligence plays, with Broadcom and Super Micro Computer also seeing significant declines. The Russell 2000, which focuses on small-cap stocks, dropped nearly 3%.

Stocks directly impacted by the tariffs, or potential retaliatory measures, also saw losses. Shares of General Motors and Ford hit session lows following Trump’s remarks, while exchange-traded funds tracking Mexico and Canada each dropped more than 1%.

“Whether the stock market can withstand this shift remains uncertain,” said Chris Rupkey, chief economist at FWDBONDS. “Tariffs, one way or another, will be a shock to the economy.”

Monday’s steep decline follows a weak February, during which major indexes posted losses driven by tariff concerns and signs of economic softness. The Dow and S&P 500 each declined over 1% for the month, while the Nasdaq suffered its worst performance since April 2024, retreating around 4%.

Economic data released Monday on manufacturing and construction provided further cause for concern about the U.S. economy. The reports kicked off a crucial week for economic indicators, culminating in the February jobs report set for release on Friday.

Market Recap: Key Highlights

Stocks Close Lower

  • The Dow and S&P 500 dropped 1.5% and 1.8%, respectively, while the Nasdaq Composite lost 2.6%.

ETFs Tracking Mexico and Canada Decline

  • iShares MSCI Canada ETF (EWC) fell 2.1%
  • iShares MSCI Mexico ETF (EWW) slipped 0.9%

Defensive Stocks Gain Amid Sell-Off

  • Philip Morris International climbed 2%, while PepsiCo, Procter & Gamble, and Johnson & Johnson each added around 1%.

Nvidia Plunges Over 9%

  • The AI-driven chipmaker continued last week’s slump amid margin concerns and reports that Chinese buyers were circumventing U.S. restrictions to purchase its products.

Apple Emerges as a ‘Safe Haven’ Among Tech Giants

  • Melius Research analyst Ben Reitzes highlighted Apple as a resilient player in the ‘Magnificent Seven’ tech stocks, citing its strategic AI positioning and cautious capital expenditures.

Tether Announces Plans for Full Audit of Stablecoin Reserves

  • Tether appointed a new CFO to oversee a full audit, aiming to enhance transparency in its $USDT holdings, which account for 67% of the stablecoin market.

Tesla Shares Drop 4.4% After Initial Gains

  • Despite an early rally following a Morgan Stanley report calling it a ‘top pick’ in U.S. autos, Tesla reversed course as the broader market sell-off intensified.

Nasdaq Falls Below Key Technical Level

  • The Nasdaq Composite dipped below its 200-day moving average for the first time since August 2024, signaling potential technical weakness in the market.


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