Contrary to the excitement when Mr. Trump was re -elected, the S&P 500 index fell 10% in the first 52 terms – the worst since 2001.
Closing the 3/4 session, Wall Street recorded the strongest session since March 2020, when investors take care of the US reciprocal tax, causing a global trade war and a global recession. DJIA decreased by 1,682 points, equivalent to 4%. S&P 500 takes 4.85%. The strongest down is Nasdaq Composite with 6%.
The market continued to plummet when China imposed a 34% tax retaliation for the US reciprocal tax offered two days ago. At 4/4 session, the DJIA index currently decreased by 1,130 points, equivalent to 2.8%. S&P 500 takes 3.2%. Nasdaq Composite plummeted with 3.5%, as many technology companies in this index were large in China.
Nasdaq Composite approaches the market price, when it drops about 20% compared to the peak of December. The S&P 500 index also falls into the same situation, when it has decreased by 15% from the peak.
This is not the first time the US stock market has plummeted in President Trump’s second term. Session 10/3, the main indicators also plummeted for 18 months, after Mr. Trump declined to comment on the US economic recession.
Since US President Donald Trump took office in January, the S&P 500 index of the US stock market lost 10%. The market capitalization evaporates more than US $ 3,000 billion. This is the worst start of a president since Mr. George W. Bush in 2001 – after the dotcom bubbles were broken, according to data of Bloomberg.
The three main indicators of the US stock market at the beginning of Trump’s term. Graph: Reuters
This development goes against the initial excitement of the market after Mr. Trump is re -elected. The S&P index increased by 2.5% in the session right after the US election.
The current situation is also contrary to Trump’s first term. At that time, S&P 500 continuously went up in the first 40 days and increased by a total of 70% in the whole term. But now, this index is still in a downtrend, according to Factset data firm.
“We are witnessing how strong the market responds to everything that can change quickly. Investors are judging what is certain and not,” Brian Mulberry – the portfolio director at Zacks Investment Management said above above Bloomberg.
S&P 500 index movements in the term of US presidents. Graph: U.S. Bank Asset Management
There are many reasons why the US stock market has been disappointed. Recent investors have increasingly said that the US is aiming for recession. The largest economy in the world is a consumer country and this is threatened by the new White House policies. They are concerned that Mr. Trump’s import tax can cause global trade disruption and cause allies away from Washington.
At the end of the month, Goldman Sachs raised the forecast of the possibility of the US into a recession within the next 12 months, from 20% to 35%. This is the second time within a month they do this. Brett Ryan – an economist at Deutsche Bank also said that “reciprocal taxes can cause US GDP growth to decrease by 1-1.5% this year, which means the risk of recession increasingly clear.”
“The current concentration is focused on the size of the import tax, how long will it be applied and lasted,” said Rob Haworth – Director of investment strategy at the US Bank Asset Management Group. He said that in the first term, Mr. Trump’s import tax was smaller and the application time was much shorter.
“The market is falling into a swirl. We think that fluctuations continue until everything is clearer,” Terry Sandven – a stock strategist at the US Bank Asset Management Group.
Another reason for Wall Street red is that Mr. Trump’s view of the stock market has changed. Previously, Trump considered the development at Wall Street as a measure of success. In January 2024, he also forecasted the US Securities to collapse during the term of former President Joe Biden.
But this time, the US President affirmed “wanting to build a strong country” and “really cannot only care about the stock market”.
“Of course, not many investors predict this. The shock from the change of Mr. Trump’s attitude makes many people afraid,” Jim Cramer investors and famous hosts explained above. CNBC. Like former US President Joe Biden, Mr. Trump “seems to think that securities investors are often a rich group and have made enough profit”.
Cramer said this time the US president supported more protective ideas. His concentration also focused on import taxes and did not prioritize the stock market as before.
Rob Haworth – a high -level strategist at the US Bank Asset Management Group also said that based on recent statements, “President Trump does not care about securities as expected investors.”
From the campaign, Mr. Trump confirmed that the import tax will bring jobs and produce to the United States. He pledged to bring the United States to the “golden age”. However, at present, the enterprises of this country suffer great damage from the President’s policies.
The electronic table shows indicators at the New York Stock Exchange (NYSE) session 3/4. Image: Reuters
In the 4/4 session, the semiconductor group is currently the strongest seller. Marvell Technology decreased by 9.5%. Micron takes 7.6%. AMD, Qualcomm, Broadcom, Intel and Nvidia dropped 4-6%. NVIDIA is building many new chip factories in Taiwan. The supply chain of this company also depends on the assembly in Mexico.
Similarly, luxury stock groups and sports costumes are also in red. Nike takes 5%, Deckers Outdoor decreased by 6.5%. Ralph Lauren and Capri Holdings takes 5%. The supply chain of technology or retailers whose in common is depends on Asian supply, including China or neighboring countries, like Mexico.
The group of Chinese -listed corporate stocks listed in the United States did not escape the general situation. Alibaba and JD lost more than 9%. PDD – Temu, Baidu and NetEase parent company decreased by 5-7%.
According to the announcement of the US, goods from China are currently subject to a total tax of 54%, Vietnam has 46%, Cambodia 49%and Indonesia 32%.
Earlier this month, researchers at Goldman Sachs Group, Societe Generale and Yardeni Research have lowered the S&P 500 year. With Goldman and Yardeni, this is the second time in less than a month.
Yardeni said that the S&P 500 ended this year at 6,000 points, reduced from the previous 6,400 forecasts. Goldman decreased from 6,200 to 5,700 points. And Societe Generale down the target from 6,750 to 6,400 points. David Kostin – a team leader at Goldman Sachs said that the main reason is that Trump’s import tax policy is more serious than their forecast.
However, their forecasts show that the S&P 500 will still increase this year. This index starts the year at 5,800 points.
“We expect confidence to return at the end of the year. In the second quarter, the S&P 500 can increase, if the development is like the 2018 trade war,” analyst at Societe Generale said.