Dow's Dizzying Descent: Market Turmoil Amid Tariff Tensions

The S&P 500 closed below 5,000 points for the first time in nearly a year, reflecting a significant downturn as U.S. tariff policies remained uncertain. This marked a 19% drop from its record high, approaching a bear market. Investors remain uneasy about future earnings amid ongoing trade tensions.

The S&P 500 slipped under the 5,000-point mark for the first time in close to a year, erasing a promising early-day rally. Investors' hopes dwindled on any potential U.S. tariff relief before the looming midnight deadline, causing the benchmark index to fall by 1.6% on Tuesday. This slump marks a loss of $5.8 trillion since President Trump announced hefty tariffs on U.S. trade partners, leading to a substantial 12% four-day percentage decline—the largest since the pandemic.

As the S&P 500 finished nearly 19% lower than its record close on February 19, it edges closer to the technical bear market zone, characterized by a 20% fall. Meanwhile, the Dow Jones Industrial Average saw a 0.84% decline, and the Nasdaq Composite slipped 2.15%.

Market analysts signal caution amid the turmoil. Peter Tuz of Chase Investment Counsel noted that initial optimism about a swift tariff resolution vanished throughout the day, leading to plummeting confidence in earnings forecasts. Similarly, Chris Grisanti from MAI Capital Management warned against uncertainty and suggested approaching investments with prudence. Despite a challenging environment, some experts remain slightly hopeful for future negotiations.

(With inputs from agencies.)