The stock market experienced a roller coaster ride on Monday as investors reacted to mixed signals about President Donald Trump’s tariffs. The Dow Jones Industrial Average and S&P 500 closed lower, ending a volatile trading session that saw major reversals. The Dow posted its largest intraday point swing ever, falling more than 1,700 points during its session low before swinging up 2,595 points from the low.
Ultimately, the Dow dropped 349 points, or 0.91%, while the tech-heavy Nasdaq ticked up 0.1%. The S&P 500 closed down 0.23%. Markets dropped sharply at the opening of trading but quickly recovered those losses and moved higher in response to a social media post from Trump indicating a willingness to negotiate tariffs.
“Countries from all over the World are talking to us,” Trump said on Truth Social. “Tough but fair parameters are being set.”
However, Trump soon escalated the United States’ trade spat with China, reversing market gains. He threatened to slap an additional 50% tariff on China unless the country withdraws 34% retaliatory tariffs announced last week.
Dow drops amid tariff uncertainty
The threatened 50% tariff would bring total U.S. tariffs on Chinese goods to 104%. The market continued to move lower on Monday, in line with the selloff that extended losses propelled by Trump’s announcement of far-reaching tariffs last week.
The Dow suffered its worst week since 2020, and the Nasdaq ended last week in a bear market. Bret Kenwell, U.S. investment analyst at eToro, told reporters, “The immense amount of volatility at the moment amid an immense amount of uncertainty.” Ivan Feinseth, a market analyst at Tigress Financial, also underscored the high stakes of tariffs, saying, “You can draw a line from these tariffs to the fact they could slow growth, increase inflation, and put the Federal Reserve on hold. Now everything is in a panic.”
Despite the volatility, the brief upsurge in response to potential tariff negotiations indicated an eagerness among investors for a thaw in global trade tensions.
“The market is wound up to bounce back on positive news,” Feinseth added. The sell-off on Monday also impacted global markets, with Asian markets facing significant declines and European indexes following suit. Investors expected continued market turmoil in response to Trump’s “Liberation Day” tariffs announced last week.
The mixed reactions to Trump’s tariffs highlight a market grappling with significant uncertainty as it anticipates further developments in the global trade landscape.
