Today’s Market ActionMajor Market Indexes Struggle as Tariff Concerns Persist
As of midday on Monday, April 7, 2025, U.S. markets continue to experience significant volatility following President Trump’s sweeping tariff announcements last week. The S&P 500 is down 1.9% to 4,980 after initially plunging 3.5% at the open, briefly entering positive territory, then resuming its decline.
This market turbulence follows a devastating week for global equities, with the S&P 500 and Nasdaq recording their biggest two-day drop since March 2020.
The VIX index, Wall Street’s “fear gauge,” has surged to levels rarely seen outside of major crises like the 2008 financial collapse and the early pandemic period, reflecting extreme investor anxiety.
Global Markets Reel from Tariff Impact
International markets have experienced even more severe declines today. Hong Kong’s Hang Seng plummeted 13.2%, marking its steepest drop since the 1997 Asian financial crisis.
European markets are also suffering, with Germany’s DAX down 4.8%, France’s CAC 40 shedding 5.1%, and Britain’s FTSE 100 losing 4.9% in midday trading.
The global market rout has already wiped out approximately $9.5 trillion in equity value worldwide, putting immense pressure on investors and policymakers alike.
Major Stock Movers and Sector Performance
Several notable stocks are making significant moves today:
– **Automakers**: Legacy carmakers continue to decline amid tariff concerns. Stellantis (STLA) has plunged more than 9%, Ford (F) is down nearly 3%, and General Motors (GM) has pulled back 5% following a Bernstein downgrade to underperform.
– **Tesla (TSLA)**: The electric vehicle manufacturer has sank nearly 7%, extending its 2025 decline to more than 40% due to supply chain headwinds from tariffs and brand issues related to Elon Musk’s political activities.
– **Big Tech**: Major technology companies continue to face pressure. Apple (AAPL), which manufactures devices in China, is down 4%. Nvidia (NVDA) has lost 6%, while Alphabet (GOOGL), Microsoft (MSFT), and Amazon (AMZN) are each trading lower by more than 2%. Meta (META) has fallen nearly 4%.
– **Banking Sector**: Major banks are declining on recession fears. JPMorgan Chase (JPM) has dropped nearly 4% as CEO Jamie Dimon warned that new tariffs would boost inflation and hurt the U.S. economy. Citigroup (C) and Morgan Stanley (MS) have each lost more than 4%, while Goldman Sachs (GS) is down 5%.
– **Chinese ADRs**: U.S.-listed Chinese companies are experiencing steep declines, with Alibaba (BABA), JD.com (JD), and Bilibili (BILI) all down more than 8%.
Upcoming Market Events and Earnings Releases
This week marks the beginning of the first-quarter earnings season, which could provide further direction for markets amid the current uncertainty. Today alone features 359 companies reporting earnings, though most are smaller firms.
Key upcoming earnings releases this week include:
– **Monday, April 7**: Several smaller companies including Affimed NV (AFMD), Digital Ally (DGLY), and Datametrex AI (DTMXF)
– **Later This Week**: The earnings calendar becomes more active with larger companies reporting in the coming days, potentially providing insight into how businesses are adapting to the new tariff environment
– **Next Week**: Major financial institutions JPMorgan Chase (JPM) and Wells Fargo (WFC) will lead the official start of earnings season during the second full week of April
Analysts at FactSet estimate a year-over-year earnings growth rate of 7.3% for S&P 500 companies, which would mark the seventh straight quarter of earnings growth for the index.
Economic Outlook and Federal Reserve Response
The economic outlook has deteriorated significantly in recent days. Goldman Sachs economists have raised the odds of a U.S. recession this year to 45%, citing the combination of “larger tariffs, greater policy uncertainty, declining business and consumer confidence, and messaging from the administration indicating greater willingness to tolerate near-term economic weakness.”
Markets are now pricing in 125 basis points of interest rate cuts by the Federal Reserve before year-end, equivalent to five quarter-point reductions, as investors anticipate the central bank will need to respond to economic weakness.
However, Fed Chair Jerome Powell indicated on Friday that the central bank is not rushing to cut rates. Powell expressed concern about the tariffs’ potential inflationary impact as well as their effect on growth, stating, “It is too soon to say what will be the appropriate path for monetary policy.”
Looking Ahead: What Investors Should Watch
As markets continue to digest the implications of the new tariff policies, several key factors will influence trading in the coming days:
1. **Administration Statements**: Any indication that President Trump might soften his tariff stance could provide relief to markets. So far, the president has remained firm, stating on Sunday: “I don’t want anything to go down. But sometimes you have to take medicine to fix something.”
2. **International Responses**: Further retaliatory measures from trading partners could exacerbate market concerns. China has already announced 34% tariffs on all U.S. exports, and the European Union is preparing targeted countermeasures on up to $28 billion of U.S. imports.
3. **Earnings Guidance**: As companies begin reporting first-quarter results, their forward guidance will be crucial in assessing the potential long-term impact of tariffs on corporate profitability.
4. **Federal Reserve Communications**: Additional comments from Fed officials could provide insight into how monetary policy might respond to the changing economic landscape.
The coming days will be critical as investors attempt to gauge whether the current market turbulence represents a buying opportunity or the beginning of a more prolonged downturn. With tariffs set to take effect soon and global retaliation mounting, market volatility is likely to persist in the near term.