US stocks tumbled, Bitcoin plunged, and Wall Street’s fear gauge hit its highest level this year as concerns over President Donald Trump’s economic policies triggered a widespread market selloff on Monday, CNN reported.
The market downturn began early, with all three major indexes opening in the red and continuing to slide throughout the day. Despite a brief afternoon rally, they closed sharply lower.
- Dow Jones Industrial Average fell 890 points, recovering slightly from an earlier loss of over 1,100 points.
- S&P 500 dropped 2.7%, marking its worst day of the year.
- Nasdaq Composite plunged 4%, experiencing its largest single-day drop since September 2022.
This selloff extended a difficult month for markets, erasing the gains made since the US presidential election in November.
Concerns Over Tariff Policy and Recession Fears
The market turmoil was largely driven by growing concerns over Trump’s tariff policies. In an interview on Fox News’ Sunday Morning Futures with Maria Bartiromo, Trump declined to rule out the possibility of a recession, stating that the US economy would experience a “period of transition.”
“I hate to predict things like that. There is a period of transition because what we’re doing is very big,” Trump said when asked about the risk of a recession this year.
Anthony Saglimbene, chief market strategist at Ameriprise, noted that investors were unsettled by Trump’s reluctance to rule out a recession. “President Trump’s comments not necessarily taking a recession off the table unnerved investors who were already on edge,” he said.
Tech Stocks Lead Market Decline
Tech stocks bore the brunt of the selloff, dragging the Nasdaq into correction territory and pulling the S&P 500 down 8.6% from its record high on February 19.
Major tech giants saw sharp losses:
- Tesla (TSLA) plummeted 15.4%, extending a 45% decline for the year amid reduced European sales and protests over CEO Elon Musk’s role in the Trump administration.
- Nvidia (NVDA) fell 5%, while AI firm Palantir (PLTR) dropped 10%.
- Alphabet (GOOG), Amazon (AMZN), Apple (AAPL), Meta (META), and Microsoft (MSFT) all closed in the red.
Meanwhile, Bitcoin slid to $78,000, its lowest level since November, as investors fled riskier assets.
White House Defends Economic Strategy
Despite market turmoil, the White House defended Trump’s economic policies. White House spokesperson Kush Desai issued a statement on Monday, asserting that the president’s “America First” agenda—including tariffs, deregulation, and energy expansion—would drive “historic” economic growth.
“Since President Trump was elected, industry leaders have responded to his policies with trillions in investment commitments that will create thousands of new jobs,” Desai stated. “President Trump delivered historic job, wage, and investment growth in his first term, and he is set to do so again.”
Tariff Concerns Shake Investor Confidence
Investor anxiety intensified after Trump announced a series of new tariffs:
- Doubled tariffs on all Chinese imports, raising them from 10% to 20%.
- 25% tariffs on steel and aluminum imports, set to take effect on March 12.
- Threatened a 250% tariff on Canadian dairy products and high tariffs on lumber imports.
Speaking to Fox News, Trump indicated that tariffs could “go up as time goes by,” further fueling market uncertainty.
Investors Brace for Inflation Data
As investors seek safety, the 10-year US Treasury yield fell to 4.225%, reflecting a rush toward government bonds amid uncertainty over economic growth.
This week, markets will closely watch monthly inflation data expected on Wednesday and Thursday, which could provide insight into whether inflation remains persistent.
A recession is traditionally defined as two consecutive quarters of negative GDP growth, and with markets on edge, investors are weighing the possibility of an economic slowdown under Trump’s second term.