Trump Tariffs Stir Uncertainty in U.S. Stock Market
The U.S. stock market is experiencing significant turbulence as investors grapple with the uncertainty surrounding former President Donald Trump's proposed tariffs. The S&P 500 is on track for its largest quarterly loss in nearly three years, reflecting the market's unease over potential stagflation risks fueled by these tariffs.
Analysts point to the looming tariffs as a primary factor contributing to the market's downturn. The uncertainty has led to increased volatility, with investors pulling back from riskier assets. MarketWatch reports that the threat of stagflation, characterized by stagnant growth and rising inflation, is adding to the jitters among investors.
The Dow, Nasdaq, and S&P 500 have all felt the impact, with the latter facing its most significant quarterly decline since the onset of the global health crisis. The Washington Post highlights that Trump's tariff proposals are seen as a direct threat to economic stability, prompting a cautious approach from market participants.
As the market navigates this period of uncertainty, investors are closely watching for any developments on the tariff front, hoping for clarity that could help stabilize the financial markets.
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Why is the stock market tanking?
Several catalysts contributed to the sell-off, including the release of a hotter-than-expected Personal Consumption Expenditures index reading. Consumer confidence, which hit its lowest level since November 2022, also fueled the sell-off. Trump's tariff plans have also spooked markets as investors went risk-off.
Why is the S&P 500 down?
The S&P 500 (SPX) lost ground last week for the fifth time in six weeks amid uncertainty about the impact of tariffs and growing concerns the economy could be headed toward a recession.
Will tariffs hurt the stock market?
Analysts at Goldman Sachs cut their forecast for the S&P 500, citing “higher tariffs, weaker economic growth and greater inflation than we previously assumed” in a note on Sunday. They expect the index to fall another 5 percent in the next three months.
Why is the Nasdaq falling?
The Nasdaq Composite (^IXIC) fell 0.1% to end the month down more than 5%. Year-to-date the tech heavy index is down more than 10% as growth stocks have been hit amid worries of sticky inflation as President Trump announced a series of tariffs since taking office, with more to come later this week.
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