U.S. Stocks Plunge as Dow Sheds Nearly 1,700 Points on New Tariff Plan
U.S. stocks closed sharply lower Thursday, with the Dow Jones Industrial Average tumbling nearly 1,700 points and the S&P 500 falling around 275 points, after President Donald Trump announced a sweeping new tariff plan late Wednesday.
The tariffs—set to take effect April 5—impose a minimum 10% duty on all imports, with even steeper rates targeting specific countries. Notably, nations such as Bangladesh, Vietnam, Laos, and Cambodia—key trade partners and manufacturing hubs for companies shifting supply chains from China—face the highest tariffs.
Retail stocks were hit hard, with shares of Walmart, Target, Five Below, Gap, Dollar Tree, and Amazon falling due to their heavy reliance on Asian imports. In tech, Apple shares plunged 9.25% amid concerns over its extensive manufacturing presence in China.
Semiconductor and pharmaceutical sectors were spared in this round of tariffs, according to economists.
Investor anxiety over a potential global trade war intensified, with countries from China to Canada condemning the move and threatening reciprocal tariffs. Economists warn that such escalation could drive up consumer prices and stall economic growth.
“While the U.S. has left the door open to negotiations, political pressures in other nations could complicate the path to new trade deals,” said Brian Gardner, Chief Washington Policy Strategist at Stifel. “Trade wars are easy to start but hard to end.”
Gregory Daco, Chief Economist at EY, noted the financial impact: “The median U.S. household could lose $690 annually, while the poorest 20% could see losses exceeding $1,000.”
The market selloff was historic:
- Dow Jones fell 3.98% (1,679.39 points) to 40,545.93, its worst day since September 2022.
- S&P 500 dropped 4.84% (274.45 points) to 5,396.52, marking its biggest decline since June 2020.
- Nasdaq sank 5.97% (1,050.44 points) to 16,550.60, the sharpest drop since March 2020.
Both the S&P 500 and Nasdaq entered correction territory—defined as a decline of at least 10% from recent highs. Thursday also marked the largest single-day market value loss since the start of the COVID-19 pandemic in March 2020.
“The coming week will be crucial, especially with the steepest tariffs set to kick in on April 9,” said Jeff Buchbinder, Chief Equity Strategist at LPL Financial. “Markets may stabilize if negotiations progress and tariff escalation halts.”
Oil prices also plunged more than 5.5%, their worst day in nearly three years, amid fears of slowing global demand and OPEC+’s surprise announcement of a larger-than-expected production increase in May.
Meanwhile, investors rushed to safe-haven assets. The 10-year Treasury yield fell to 4.045%, the lowest since October, while gold briefly hit another record high before pulling back.
Uncertainty over the length, scope, and exemptions of the tariffs continues to drive volatility. “This lack of clarity will likely delay business decisions and contribute to ongoing market swings,” said Daco.
Despite the turbulence, portfolio managers urge long-term perspective. “Country-specific tariffs are likely a negotiation tactic,” said Adam Hetts, Global Head of Multi-Asset at Janus Henderson Investors. “There’s significant room for de-escalation, though the 10% base rate adds a floor.”
Chris Zaccarelli, CIO at Northlight Asset Management, echoed this: “The silver lining is that this could be a starting point for global negotiations. But for now, traders are reacting swiftly and cautiously.”
“Market pullbacks, while uncomfortable, are part of investing,” added Larry Adam, CIO at Raymond James.
Further interest rate adjustments may also be on the horizon, as policymakers weigh the economic impact of the new tariffs.