Stocks marked their worst day since 2020

Stocks lost $3.1 trillion in combined market value on Thursday after investors reacted to President Donald Trump’s sweeping new tariffs, marking its biggest decline since 2020.

The S&P 500 dropped nearly 5%, the Dow plunged 1,678 points, and the tech-heavy Nasdaq lost 6%. The WSJ Dollar Index fell 1.3%—suffering its worst drop since 2023.

Tech giants Apple, Amazon, Meta, Tesla, Alphabet, Microsoft and Nvidia saw steep declines.

Apple manufactures most of its products in China, which are subject to a 54% tariff when sold in the US. Nike tumbled over 14% due to tariffs on imports from Vietnam and Indonesia.

Other retail giants that suffered include the parent company to The North Face and Vans, VF Corp; its share dropped 25%. Stocks of Lululemon, Dollar Tree, Target, Starbucks, Dell, HP, and others also declined.

Investors flee to safe assets
The tariff shock added to inflation fears, pushing investors toward safer assets. The 10-year Treasury yield fell to 4.04%, its lowest since October. Gold prices surged 19% in the first three months of the year, surpassing over $3,100 per ounce.

Meanwhile, JPMorgan has raised its recession probability estimate to 60%.

Global markets follow suit
European and Asian markets also tumbled. The Stoxx Europe 600 dropped 2.6%, with major banks and consumer brands sliding. In Asia, shares of Toyota and Samsung fell, while oil prices slumped over 6% amid global economic concerns.

However, there are some industries, like utilities and personal care, among others, that were not affected.

Uncertainty looms over Fed policy
With tariffs pushing the US tariff rate to 22%, its highest level in over a century, investors are bracing for an economic slowdown. Many expect the Federal Reserve to cut interest rates aggressively to counteract potential recession risks.