U.S. Stock Market Summary for Thursday, April 3, 2025
Major Indices:
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S&P 500: -4.84% → 5,396.52
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Dow Jones Industrial Average: -3.98% → 40,545.93
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Nasdaq 100: -5.41% → 18,521.48
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Russell 2000: -6.59% → 1,910.55
Market Overview:
U.S. equities suffered their steepest one-day losses since the pandemic-driven selloff in 2020, following President Donald Trump’s announcement of sweeping new tariffs. The S&P 500 plunged nearly 5%, wiping out approximately $2 trillion in market value. The tech-heavy Nasdaq led the decline, tumbling over 6%, while the Dow shed nearly 4%. The sell-off was broad-based, driven by fears of a global trade war and concerns over its economic fallout.
Tech stocks bore the brunt of the decline. Apple fell more than 9% amid fears of supply chain disruptions, as key iPhone components sourced from China are now subject to a 54% import tariff. Semiconductor stocks like Nvidia also dropped sharply, contributing to a staggering $900 billion reduction in the combined market cap of the “Magnificent Seven” mega-cap tech names.
President Trump acknowledged the market downturn, likening the tariff implementation to "a necessary surgery," and left the door open to negotiations should "great offers" be made by trade partners.
Sector Highlights:
Defensive sectors outperformed amid the chaos. Lamb Weston surged 10% on safe-haven demand for food stocks, while grocery chain Kroger added 5%. Johnson & Johnson rose 2.9% as pharmaceutical shares drew investor interest. In contrast, consumer discretionary names reliant on global supply chains plummeted—Best Buy slid 17.8%, and RH (formerly Restoration Hardware) plunged 40%, reflecting vulnerability to increased import costs.
Economic Snapshot:
The U.S. trade deficit narrowed to $122.7 billion in February from $130.7 billion in January. Exports rose to $278.5 billion, while imports held steady at $401.1 billion, indicating slight strength in outbound trade prior to the new tariff implementation.
Expert Commentary:
Broad Reach Investment Management's Bradley Wickens turned structurally bearish, forecasting further 6–7% declines in equities over the coming months.
George Bory of Allspring Global Investments emphasized that the Fed has tools to respond, but markets are now pricing in four 25bps rate cuts this year with a 50% probability.
Legendary investor Bill Gross warned against “catching a falling knife,” likening the current trade event to the 1971 end of the gold standard, but with immediate negative repercussions.
Sanctuary Wealth’s Mary Ann Bartels and BCA Research’s Irene Tunkel both cautioned that sustained tariffs will undoubtedly slow the global economy.
Apollo Global Management’s Jim Zelter placed the odds of a U.S. recession above 50%, citing inflationary risks and a constrained Fed.
Government & Political Notes:
The Trump administration imposed a blanket 10% tariff on all imports, with heightened levies—up to 54%—on goods from specific nations, including China. This has triggered sharp rebukes from allies like Canada and the EU, who are preparing retaliatory measures. Bipartisan lawmakers are pushing for new legislation that would require congressional approval for future tariffs, citing economic and diplomatic risks.
Conclusion:
Thursday marked a pivotal moment for the U.S. financial markets, with a sharp sell-off driven by escalating trade tensions and the threat of a retaliatory global response. As uncertainty looms, investors are closely watching Friday’s U.S. jobs report and remarks from Fed Chair Jerome Powell for clues on monetary policy direction. With recession risks rising and market correlations intensifying across asset classes, heightened volatility appears likely in the near term.
