Wall Street’s sell-off deepened Monday, with growing concerns about the economy and President Donald Trump’s tariffs driving US stocks further from their recent record highs.
In early trading, the S&P 500 dropped 1.4%, following its worst week since September. As of 9:35 a.m. Eastern time, the Dow Jones Industrial Average was down 430 points, or 1%, and the Nasdaq composite had fallen 2.1%, according to news agency AP.
The primary US stock market measure is now headed for its seventh swing of more than 1%, up or down, in the last eight days, after a tumultuous period dominated by fears that Trump’s on-and-off tariffs could either directly harm the economy or create enough uncertainty to paralyze US companies and consumers. The S&P 500 is down 7.4% from its all-time high reached on February 19.
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The economy has shown signs of weakening, mainly reflected in surveys indicating increased pessimism. Additionally, a real-time collection of indicators compiled by the Federal Reserve Bank of Atlanta suggests the US economy could already be contracting.
When asked over the weekend about the possibility of a recession in 2025, Trump told Fox News Channel, “I hate to predict things like that. There is a period of transition because what we’re doing is very big. We’re bringing wealth back to America. That’s a big thing.” He added, “It takes a little time. It takes a little time.”
On the same weekend, US Commerce Secretary Howard Lutnick stated on NBC’s “Meet the Press” that 25% tariffs on steel and aluminum imports would take effect Wednesday.
While the US job market remains stable and the economy ended last year with solid growth, economists are lowering their forecasts for 2025. For instance, at Goldman Sachs, David Mericle revised his US economic growth estimate to 1.7% from 2.2% for the end of 2025, primarily due to higher-than-expected tariffs. He now sees a one-in-five chance of a recession in the next year.
The sell-off has notably hit some of Wall Street’s biggest stars the hardest, particularly Big Tech stocks and companies benefiting from the artificial intelligence boom in recent years.
Nvidia dropped another 2.6% on Monday, bringing its year-to-date loss to 18.3%, a stark contrast to its nearly 820% surge in 2023 and 2024.
Apple also saw a 3.2% decline, making it the heaviest drag on the S&P 500 after confirming that it would delay the AI update to its Siri personal assistant until 2026.
The downward trend isn’t limited to Big Tech; investors are also pulling back on various investments that had previously seen unstoppable momentum, including bitcoin. The cryptocurrency’s value has dropped to around $83,000 from more than $106,000 in December.
In the midst of this uncertainty, investors have flocked to US Treasury bonds as a safer bet. This surge in demand has led to higher Treasury prices and lower yields.
The yield on the 10-year Treasury fell to 4.24% from 4.32% late Friday. It has been on a downward trend since January when it was nearing 4.80%, amid growing economic concerns.
On Wall Street, Redfin saw a sharp 77% increase after Rocket announced it would acquire the digital real estate brokerage in an all-stock deal valued at $1.75 billion. Rocket’s stock, however, sank 9.7%.