Stocks Falter as Trump Hints at Economic Shift
Major stock indexes stumbled on Monday following remarks from former President Donald Trump that suggested the U.S. economy might be in for a transition period. The Dow Jones Industrial Average dropped 890 points, a 2.1% decline, while the S&P 500 fell 2.7% and the Nasdaq Composite slid 4%. Government bond yields ticked lower, with the 10-year Treasury trading near 4.22%, and oil prices wavered around $66 per barrel. Tech-focused ETFs like the Invesco QQQ Trust and the SPDR S&P 500 both saw significant losses, down 3.9% and 2.7%, respectively. The dollar index (DXY) has also fallen by roughly two points since last Tuesday, perhaps an early indicator of adjusting exchange rates in response to new American tariffs being levied.
Shares of Nvidia, Apple, and Tesla were among the hardest hit. Nvidia, for instance, lost over 5% as investors continued to offload the stock, which had closed at its lowest point since September. Tesla’s decline was even more pronounced, with a 15% drop on Monday erasing all the gains it had made in the wake of Trump’s presidency. In a recent interview, Trump himself suggested that the market might not be the best indicator of the economy’s health. “You can’t really watch the stock market,” he said, emphasizing the need for a more sustainable approach to economic growth.
The latest market turbulence comes amidst growing concern about how the U.S. will navigate the months ahead. Some officials, such as Treasury Secretary Scott Bessent, are calling for a “detox period” from heavy government spending, arguing that a shift toward private investment is necessary. At the same time, data from the Atlanta Federal Reserve’s GDPNow model suggests the economy could contract by 2.4% in the first quarter—a stark reversal from recent growth trends. While White House advisors believe this downturn is temporary and largely the result of previous policy decisions, the sudden negative forecast has rattled many on Wall Street.
Looking ahead, the coming week is packed with potential market-moving events. The February consumer price index (CPI) is due on Wednesday, and the Fed’s preferred inflation measure, the core PCE price index, will be released on Thursday. Both indicators are closely watched for signs of rising prices and economic stability. Additionally, a handful of major companies, including Adobe and Oracle, are set to report earnings, which could provide further insight into how different sectors are weathering the current uncertainty.