Jamie Spencer
The turbulent week on Wall Street continued Thursday as investors reacted to President Donald Trump’s shifting tariff policies. Stocks slid sharply, with businesses and traders struggling to interpret the administration’s latest trade moves.
Tariff Delay Sparks Market Volatility
Trump announced a nearly one-month delay on tariffs for all products from Mexico covered by the USMCA free trade treaty, marking a major reversal from the administration’s initial plan.
Commerce Secretary Howard Lutnick hinted at the delay on CNBC earlier in the day, fueling speculation that Canada might also receive a reprieve. Stocks initially pared some losses following Lutnick’s comments but tumbled again after Trump’s formal announcement.
Markets Plunge as Uncertainty Mounts
By mid-afternoon, the Dow Jones Industrial Average had dropped 600 points, or 1.42%, while the S&P 500 fell 2.1%. The Nasdaq Composite led the declines, sliding 2.9%.
The Dow is now down more than 3% for the week, on track for its worst performance since March 2023. Investor anxiety over trade policy has contributed to a weak market performance during Trump’s presidency. The Nasdaq has fallen more than 7% since he took office, while the S&P 500 is down over 4%.
Layoffs and AI Sector Worries Weigh on Markets
Market sentiment also suffered from new economic data revealing significant job losses. U.S. employers announced plans to cut 172,017 jobs in February—a 103% jump from January and the highest February total since 2009, according to Challenger, Gray & Christmas.
Meanwhile, concerns over AI-related investments further pressured tech stocks. Marvell Technologies (MRVL), a semiconductor company, dropped 18% in early trading following mixed earnings results. Nvidia (NVDA) and Palantir (PLTR) also declined, dragging the Nasdaq lower.
Adding to the uncertainty, Chinese tech giant Alibaba introduced its own AI model on Thursday, positioning itself as a challenger to OpenAI and DeepSeek. The move sparked concerns about whether the U.S. AI boom is sustainable given the vast sums being invested.
Investors Brace for More Data
Thursday’s sharp decline reversed the brief rally seen on Wednesday, underscoring a lack of confidence in the market’s direction amid ongoing trade disputes.
“For now, tariff-induced inflation amid slower growth could bring the economy dangerously close to stagflation,” said Jeffrey Roach, chief economist at LPL Financial.
Traders are now looking ahead to the U.S. government’s monthly jobs report, set for release Friday at 8:30 a.m. ET. The data will provide fresh insights into the labor market and overall economic health.
Investor sentiment remains grim, with CNN’s Fear and Greed Index signaling “Extreme Fear” as the dominant market driver over the past week.
Markets Remain on Edge
With uncertainty swirling around tariffs, layoffs, and AI investments, volatility is likely to persist. Traders will closely watch economic data and potential shifts in U.S. trade policy for any signs of stability.
