US stocks plunge on recession fears, Nasdaq sees worst day since 2022

Market Plunge Amid Recession Fears

Shares on Wall Street took a steep tumble on Monday, 10 March, as investors grew anxious that ambiguity surrounding President Donald Trump’s tariff policies might push the globe’s largest economy towards recession. Trump fuelled the unease by not dismissing the chance of a 2025 downturn, suggesting a “transitional phase” was needed to “restore wealth to America” through bold measures. Tech stocks bore the brunt, with the Nasdaq Composite Index suffering its worst single-day drop since 2022, plummeting 4.0% to 17,468.32. The S&P 500 fell 2.7% to 5,614.56, while the Dow Jones Industrial Average shed 2.1%, closing at 41,911.71. Tesla led the tech rout with a staggering 15.4% decline, joined by other giants like Alphabet, Amazon, Meta, and Nvidia.

Tariff Turmoil and Policy Shifts

Earlier optimism over tax reductions and relaxed regulations has faded, eclipsed by tariff-related jitters, according to Steve Sosnick of Interactive Brokers. Since January, Trump has rolled out widespread tariffs on imports from Canada, Mexico, and China, though he later eased some on neighbouring nations. A fresh round looms, with 25% levies on steel and aluminium set to kick in on Wednesday. Sosnick pointed to “persistent tariff confusion” and worries over excessive cuts proposed by Trump’s advisor Elon Musk—via his Department of Government Efficiency (DOGE)—as sapping consumer confidence, stoking fears of a slowdown, rising inflation, or both.

Just how bad is it?

U.S. stocks had their worst day of an already bad year on Monday as investors raced into safe-haven assets amid growing recession fears.

The S&P 500 fell 2.7% on Monday, its biggest one-day drop since December. The index has notched only two worse days in the current bull market, which began in late 2022: December 18, 2024, when the Federal Reserve scaled back its rate cut forecast, and August 5, 2024, when the unwinding of a popular leveraged trade briefly sank U.S. equities.

The last six days have been particularly punishing. The S&P 500 fell nearly 1.8% last Monday when President Trump confirmed a 25% tariff on Canadian and Mexican imports would go into effect the following day. In the five days since, stocks have fallen another 4% despite Trump again partially delaying those tariffs. The S&P 500's 5.7% decline between last Monday and today stands as the index's worst 6-day stretch since September 2022.

Stocks were rattled Monday by comments the President made over the weekend. Trump, in an interview with Fox News aired on Sunday, declined to say whether he expects the U.S. to enter a recession this year. Instead, he said the economy would experience "a period of transition" as his tariffs take effect. The comments echoed his address to Congress last week, in which he said there would "be a little disturbance, but we're OK with that."

Shaun

Founder

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Shaun

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