**US** **stocks** plummeted, **Bitcoin** took a hit, and market fear spiked following **US** President Donald **Trump**'s remarks about the economy, fueling concerns about a potential recession. The selloff began early on Wall Street, with all three major indices opening lower and continuing their downward trajectory throughout the day. Although there was a brief rally in the afternoon, the markets ended in the red, with the Dow closing 890 points lower, recovering slightly from a loss of more than 1,100 points earlier. The S&P 500 also suffered, dropping by 2.7%, while the tech-heavy Nasdaq Composite fell by 4%, marking its largest single-day drop since September 2022.
The sharp decline extended the struggles seen throughout the month, erasing the gains made by the major indices since the **US** presidential election in November. Investors' fears were heightened by concerns over the economic impact of **Trump**'s tariff policies. During an interview on Sunday, **Trump** suggested that a recession could be on the horizon, stating there would be a "period of transition" for the **US** economy. These comments unsettled investors, already jittery about the broader economic outlook.
Tech **stocks**, in particular, took the brunt of the selloff, which heavily affected the S&P 500 and pushed the Nasdaq into correction territory. Major tech companies like Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla all saw their shares fall. Tesla, in particular, closed down 15.4%, with its stock down nearly 45% this year. This slump followed protests against CEO Elon Musk over his prominent role in the **Trump** administration, as well as a decline in sales in Europe.
Anthony Saglimbene, chief market strategist at Ameriprise, pointed out that **Trump**'s refusal to rule out a recession added to the existing market unease. Meanwhile, the White House responded with optimism, asserting that **Trump**'s economic agenda would lead to "historic" growth during his second term. White House spokesperson Kush Desai highlighted that **Trump**'s policies, including tariffs and deregulation, had already attracted trillions of dollars in investments, boosting job creation and wage growth.
The broader market sentiment was also impacted by the uncertainty surrounding **Trump**'s tariff policies. His recent threats to impose significant tariffs on imports, including a 25% tariff on steel and aluminum, as well as higher tariffs on Canadian dairy and lumber, have kept investors on edge. The market responded with a flight to safety, evident in the drop in the yield on the 10-year **US** Treasury bond to 4.225%, signaling growing concerns about the economy's prospects.
The VIX, often referred to as the fear gauge, spiked to its highest level this year, reflecting widespread anxiety across the markets. **Bitcoin** dropped to around $78,000, its lowest level since November, as investors pulled back from risky assets. This downturn is compounded by the uncertainty surrounding **Trump**'s economic policies and their potential effects on global trade and growth.
This month's market turmoil has been exacerbated by a combination of factors, including concerns about **Trump**'s tariff decisions and their impact on key sectors. With the S&P 500 down 3.1% last week, its worst week since September, investors are increasingly uncertain about the future. As the markets digest the potential consequences of **Trump**'s policies, all eyes will be on the upcoming inflation data, with many looking for clues on whether inflation continues to pose a significant challenge for the **US** economy.