Market Meltdown! Trump's Tariff Threats Send Shockwaves Through Wall Street

2025-03-12 00:00:32.86

US markets experienced a dramatic seesaw on Tuesday, driven by President Trump's renewed threat of hefty tariffs on Canada. All three major indexes initially dropped sharply, with the Dow falling over 700 points at one point. However, losses were partially recouped in the afternoon following announcements of US-Canada talks to de-escalate trade tensions and renegotiate trade policy. The Dow ultimately closed down 478 points (1.14%), the S&P 500 fell 0.76%, and the Nasdaq dropped 0.18%. The S&P 500 neared correction territory, closing down 9.3% from its February high, while the Nasdaq, already in correction territory, closed 13.6% below its December high. Despite the market decline, President Trump expressed no concern, emphasizing the need to rebuild the country. Market analysts attributed the volatility to uncertainty surrounding the administration's trade policy. The Cboe Volatility Index (VIX) fell after an earlier surge, reflecting some easing of investor anxiety. The decline continues a recent market rout, raising concerns about the potential for a prolonged downturn. White House officials described the market fluctuations as a "snapshot of a moment in time" and expressed confidence in the President's economic policies. Airline stocks were among the hardest hit, following a decline in Delta's earnings forecast. Ford also experienced significant losses. The uncertainty surrounding Trump's tariff policies fueled "extreme fear" among investors, according to CNN's Fear and Greed Index, and the anxiety spread globally, impacting European markets.