Trump’s tariff shock: S&P and Dow fall, market fluctuates rapidly|
Monday was like a roller coaster ride for Wall Street. The market went up and down, but in the end both the S&P 500 and the Dow closed in red. The biggest tension was the economic slowdown and rising inflation, which increased further when US President Donald Trump threatened to impose more tariffs on China.
Panic due to tariff news, then some hope, and then fall again
Trump had announced high tariffs on every import on Wednesday last week, which already put pressure on the market. The same trend continued on Monday as well. In the morning, three major indexes – EOW, S&P and Nasdaq – fell to their lowest levels in a year. The market rallied for a while when a report said Trump was considering a 90-day tariff pause. But as soon as the White House denied this news, the market went down again.
Volatility Full High – fear index broke 5-year record
The market was moving so high and low that the CBOE volatility, which is called the “fear gauge”, went up by 60 points – the highest since August 2024. It ended at 46.98, the highest close in the last 5 years. Rick Meckler of Cherry Lane Investments said, “The problem for the market is that Trump’s solution – heavy tariffs – looks more dangerous than the actual problem.” He says investors want either a pause or a better strategy to emerge.
Market Numbers – Who won, who lost
Dow Jones fell by 349 points (0.91%), closed at 37965.60
S&P 500 went down by 11.83 points (0.23%), closed at 5,062.25
Nasdaq increased slightly by 15.48 points (0.10), closing at 15,603.26
Last week S&P had fallen by 10.5%, and the total market value had lost $5 trillion – the biggest two-day loss since March 2020. Dow is now in correction zone (i.e. more than 10% fall) and Nasdaq has gone into bear market (more than 20% fall).
What was the condition of which sector?
Real estate fell the most – 2.4% down
Communication services performed best – 1% up
Technology also rose slightly – 0.3% gain
Apple and Tesla pulled S&P down (Apple -3.7%, Tesla -2.6%)
While Nvindia (3% up) and Amazon (2.5% up) gave some support.
Market volume was at a full high
29.13 billion shares traded on Monday – which is much higher than normal (average is ~17 billion)
Friday was also a record – 26.79 billion shares, highest since January 2021
Next Focus: Fed Speeches & inflation data
This week the market is keeping an eye on Federal Reserve speeches and economic reports – especially consumer price inflation. Investors want to see if we are headed for a recession?
