Dow Sinks Nearly 500 Points To New 6-Month Low—As Trump Brandishes Another Set Of Tariffs

Topline

A new batch of tariffs from President Donald Trump on Tuesday again sent some investors scrambling, as stock indexes tumbled further as the market shudders at economic policy uncertainty.

Key Facts

Crucial Quote

“You’re going to have drops and markets are going to go up and they’re going to go down, but, you know what, we have to rebuild our country,” Trump told reporters Tuesday, referring to the heavy pressure he’s faced as equity prices have faltered thus far during his second term.

What To Watch For

The benchmark S&P is on the cusp of entering its first 10% correction since 2023, closing 9.3% below its Feb. 19 all-time high. “10% corrections usually don’t become 20% bear markets unless they’re accompanied by either an economic recession, an earnings recession, or a Fed hiking cycle,” Morgan Stanley Wealth Management strategist Daniel Skelly wrote in emailed comments. “We’re not seeing any of those right now,” Skelly continued.

Surprising Fact

The world’s most valuable automaker, Tesla, was immune from Tuesday’s slide, as shares of the electric vehicle firm climbed 4%, bouncing slightly from its staggering recent losses. Also rising Tuesday were shares of artificial intelligence giant Nvidia, which declined 23% in the three-week stretch ending Monday.

Key Background

Nvidia’s and Tesla’s bounce came after the pair headlined Monday’s brutal selloff as the Nasdaq suffered its worst day since 2022, declining 4%. All three major indexes are down significantly since Trump took office in January, and are in the red since he won a second term in November, erasing what were once robust gains. Trump has said to pay little attention to the stock market, while strategists have largely expressed concern at the lack of policy clarity. Trump’s tariffs will worsen inflation and slow economic output, according to Goldman Sachs economists, who raised their probability of a recession in the next year from 15% to 20% last Friday.

Further Reading

ForbesStock Market Comeback Erased: S&P 500 Sinks To 6-Month Low As Trump Says Don’t ‘Watch The Stock Market’By Derek Saul

ForbesAre We Suddenly Close To A Recession? Here's What The Data Actually Shows.By Derek Saul