U.S. stocks were abandoned in early Monday trading, suddenly turning the course around, opportunistic investors jumped around to snap up stocks.
The S&P 500 fell 3.5% from the gate, but quickly eliminated those losses, up 97 points or 1.9% to 5,171 as of 10:21 AM ET. As trading opened, the Dow Jones fell more than 1,200 points, and turned around, adding 451 points, or 1.2%, while the Nasdaq Complex lost most of its early stages.
Investors have paid President Trump’s tariffs, saying they could hit U.S. economic growth and drive inflation higher. Goldman Sachs economists on Monday listed the rebound in taxes, raising the chances of a recession to 45%.
“The combination of greater tariffs, greater policy uncertainty, a decline in business and consumer confidence and a government message suggests that the willingness to tolerate recent economic weaknesses in pursuing its policies increases downside risks,” Goldman Sachs analysts said in a note.
Mr. Trump announced a 10% global tariff on all imports and “countdown” tariffs on nearly 90 countries on April 2, with stocks plummeting last week. New trade measures send markets into a tailings, with the S&P 500 S&P and Nasdaq cases recording the biggest two-day decline since March 2020.
Overseas stock markets also suffered huge losses on Monday, and have been slipping since last week. Hong Sang-deng in Hong Kong fell 13.2%, the biggest drop since the Asian financial crisis in 1997, while Taiwan’s Taiext fell 9.7%, the heaviest loss on record. Tokyo’s Nikkei 225 index fell 7.8%, Shanghai Composite Index sank 7.3%, South Korea’s Kospi fell 5.6%, and Australia’s S&P/ASX 200 fell 4.2%.
In Europe, Germany’s DAX index fell 4.8% during midday trade. The CAC 40 in Paris also fell by 5.1%, while the ftse 100 in the UK lost 4.9%.
“The near future of stock prices depends largely on Donald Trump’s whimsicality,” Thomas Mathews, head of Asia Pacific Markets at Capital Economics, told investors. “If he faces the market’s actions and/or decides he gets enough concessions, he can raise some tariffs and sentiment may change soon.”
