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Stocks fell sharply on Monday as Wall Street’s fears tied to President Donald Trump’s tariffs continue to pressure the market and investors wait for new economic data.
The Dow Jones Industrial Average dipped by 325 points, or about 0.8%, in mid-morning trading. But the other major market indexes saw much steeper losses. The S&P 500 fell almost 2%, and the Nasdaq plunged 3.5%. Last week was the stock market’s worst in two years.
The so-called Magnificent Seven tech stocks also lost ground. Tesla (TSLA) stock dropped 8.6%, and Nvidia (NVDA) stock was off about 5%. Tesla stock had fallen by more than 30% year-to-date through Friday, largely thanks to pushback related to CEO Elon Musk’s political influence, while Nvidia’s almost 19% loss has come in response to tariff and recession fears.
The president’s sweeping tariffs on Canada, Mexico, and China last week — with the promise of additional duties in the near future — rattled stock markets and drove pushback from business groups. Although some exemptions and delays were announced later in the week, Wall Street’s worries weren’t assuaged.
Goldman Sachs (GS) said Friday that the likelihood of a recession within the next 12 months has increased from 15% to 20%. If the White House continues with additional tariffs, the bank said the risk of a recession would increase.
On Sunday, Trump was asked by Fox News (FOXA) host Maria Bartiromo if he was expecting a recession this year. The president didn’t rule it out as a potential outcome.
“I hate to predict things like that,” Trump said. “There is a period of transition, because what we’re doing is very big. We’re bringing wealth back to America. That’s a big thing, and there are always periods of, it takes a little time. It takes a little time, but I think it should be great for us.”
Cabinet officials have largely brushed off the market’s decline, even as they acknowledge some signs of weakness in the economy.
Treasury Secretary Scott Bessent told CNBC that the market has “just become hooked” on government spending and that “there’s going to be a detox period.” Commerce Secretary Howard Lutnick said the U.S. would stick to its future tariff plans, said he wouldn’t bet on a recession, and said the stock market doesn’t affect federal policy.