Stock market falls at opening as Dow drops 1,000-points on Trump’s tariff fears: S&P and NASDAQ also down
The U.S. stock markets are taking a beating as investors fear on the impact of President Donald Trump’s tariff plan.
Quickly after opening, the Dow Jones, the NASDAQ and the S&P 500 all took a dive. By 11 a.m., the Dow was down 1,529 points. The NASDAQ was down 1,011 points – and if that figure holds to close, it would be just below the record for the biggest one-day point drop in the market’s history.
The Dow Jones drop is on pace to be among the top 5 worst point-drop days for that market.
Investors sparked a sell-off a day after Trump announced his tariff plan that puts new levies on goods from nearly every country. Trump and his team have said the policy is necessary to make it fair for American manufacturers. But, experts have warned that his tariffs could have a massive negative impact on the economy. Tariffs are taxes on goods imported into a nation — but it’s often the consumer footing the bill and paying higher prices.
Before the market opened — but with the backdrop of dipped stock futures — Trump compared the new tariffs to a surgical procedure, writing on Truth Social Thursday morning: “THE OPERATION IS OVER! THE PATIENT LIVED, AND IS HEALING. THE PROGNOSIS IS THAT THE PATIENT WILL BE FAR STRONGER, BIGGER, BETTER, AND MORE RESILIENT THAN EVER BEFORE. MAKE AMERICA GREAT AGAIN!!!”
As the markets declined, White House officials defended the tariffs.
Vice President JD Vance told Fox & Friends: “A lot of people have gotten rich from American companies moving overseas but American workers have not gotten rich and frankly American companies have not gotten wealthy from the increasing growth of foreign competitors manufacturing overseas.”
Asked on CNN at what point the U.S. might consider backing off on tariffs, especially considering countries have already vowed to retaliate, Commerce Secretary Howard Lutnick said: “I don’t think there’s any chance Trump is gonna back off his tariffs. This is the reordering of global trade.” He added: “The world should stop exploiting the United States.”
Stocks of large restaurant chains also slid Thursday morning as their major imports are likely to be affected by the new levies, with Starbucks falling nearly 7 percent and Chipotle falling about 4 percent.
Retailers are also down as they brace for supply chain disruptions; shares in Lululemon and Nike each dipped 12 percent Thursday morning while Gap tanked 21 percent and Macy’s dropped 14 percent.
American employees in the auto industry could also soon feel the impacts of the new tariffs as Stellantis, which owns Jeep, Chrysler, and Dodge, announced it was halting production at its factories in Mexico and Canada asTrump’s 25 percent tariff on imported cars starts. About 900 U.S. employees are expected to be laid off, the automaker said Thursday. Stellantis stock was down more than 7 percent Thursday just before noon.
Investors are struggling to navigate Trump’s tariffs, Sarah Ketterer, chief executive and portfolio manager at Causeway Capital Management, told the Wall Street Journal. “I’m bewildered,” Ketterer said. “We’re sailing into some seriously uncharted waters.”
Some Americans fear that the reactions to the new tariffs are going to harm their retirement retirement savings — and some experts warn they might.
“For the small investor, the decline in value will be devastating, particularly for retired baby boomers,” Peter Ricchiuti, a professor at Tulane University’s Freeman School of Business, told Business Insider.
Sen. Adam Schiff predicted that Trump’s “Liberation Day” tariffs will actually liberate Americans from “being able to afford groceries,” “much of their savings,” and “any hope of buying a home.”
Leaders of the some of the U.S.’s largest trading partners have said they are already preparing reciprocal tariffs.
European Commission President Ursula von der Leyen called Trump’s decision a “major blow” to the global economy, adding Thursday: “We are now preparing for further countermeasures, to protect our interests and our businesses if negotiations fail.”
Germany’s ecnomics minister Robert Habeck went so far as to rename Trump’s “Liberation Day” as “inflation day.” Other world leaders have denounced the new levies, but vowed to work with the U.S. to avoid a trade war.
“The American economy and Americans, whether businesses or citizens, will emerge weaker and poorer,” French President Emmanuel Macron predicted Thursday.
But business leaders warn these levies will have deleterious impacts for American families.
National Association of Manufacturers president and CEO Jay Timmons said in a statement on Wednesday that Trump’s tariffs will “threaten investment, jobs, supply chains, and, in turn, America’s ability to outcompete other nations and lead as the preeminent manufacturing superpower.”
“Trump is going to war with countries on this,” Andrew Brenner, head of international fixed income at National Alliance Securities, told the New York Times. “It’s ridiculous. It shows no comprehension as to what he is doing to other countries. And it is going to hurt the U.S.”
House Democratic leader Hakeem Jeffries told MeidasTouch after Trump’s announcement: “The stock market is collapsing, and what that means is the retirement savings of everyday Americans are disappearing by the hour. And this is all because of Trump’s reckless mismanagement of the economy and now, these tariffs that are being imposed are going to raise the cost of goods for everyday Americans by some estimates, by thousands of dollars per year.”