U.S. stocks experienced significant turmoil on Monday as former President Donald Trump launched fresh attacks on Federal Reserve Chair Jerome Powell, casting doubt on the future of the economy and trade relations. The Dow Jones Industrial Average plummeted by more than 971 points, marking a drop of 2.48%, while the S&P 500 and Nasdaq Composite followed suit, losing over 2.36% and 2.55%, respectively.
Tech stocks bore the brunt of the market sell-off, with notable declines in major companies: Tesla and Nvidia fell by 7% and 6% respectively, and giants such as Amazon, AMD, and Meta saw their shares decrease by around 4%.
In a critical post on Truth Social, Trump labeled Powell as “Mr. Too Late,” and expressed pressing demands for immediate interest rate cuts from the Federal Reserve, raising concerns about the independence of the central bank. His suggestion of removing Powell from his influential role has further unsettled investors, leaving them anxious about the implications for monetary policy.
The negative sentiment wasn’t just limited to the stock market; the dollar weakened considerably, hitting its lowest value since 2022. On the other hand, the price of gold surged, surpassing $3,400 per ounce—setting a new record. Meanwhile, Bitcoin experienced a remarkable uptick, trading above $87,000.
Among the factors exacerbating the market’s instability are escalating trade tensions, especially concerning China’s import reductions of U.S. commodities. Recent actions from China, including the halting of specific purchases and issuing warnings to countries contemplating trade agreements with the U.S., have compounded fears of a protracted trade war.
- The S&P 500 has seen an 8% decline since Trump’s announcement of new tariffs on April 2.
- The Nasdaq and Dow have dropped nearly 10% and 9%, respectively, during the same period.
- Investors are now eyeing upcoming earnings reports from Tesla and Alphabet for insight into economic trends.
As this earnings season unfolds, market watchers will remain vigilant for signs of vulnerability in key sectors. The uncertainty fueled by Trump’s rhetoric and tumultuous trade relations could continue to shape investor sentiment in the weeks ahead, keeping the stock market in a state of flux.
