Warnings about Trump’s tariffs have caught up with the US amidst more tariffs imposition. The bull rally caused by Trump’s victory has officially been erased. The S&P 500 index has now lost $3.3 trillion since February 19th translating to $330billion per trading day for the last 10 days.
During the presidential campaign trail, POTUS Trump promised to Make America Great Again (MAGA) on all frontiers. However, current data and market correction point to a disillusioned future should traders continue to put their faith in Trump.
The S&P 500 index has been down 1% since election day. Since hitting a new all-time high, it has been down 7%. The index is now only 3% away from entering correction territory.
In addition, since election day, the Nasdaq 100 has dropped more than 4%, and the tech index as a whole has dropped about 1.5%.
Since November 5, the blue-chip Dow has lost almost 1%. Meanwhile, in just 24 hours, the Dow Jones Industrial Average has lost -1,700 points. The Nasdaq is only about 0.5% away from recession territory. More than $4 trillion has been lost.
BREAKING: The Volatility Index, $VIX, is now up +65% since February 20th.
— The Kobeissi Letter (@KobeissiLetter) March 4, 2025
To add salt to injury, the Volatility Index ($VIX) is now up 65% since February 20th. This marks the index’s first move above 25 since December 18th.
The tariffs between the U.S., China, Canada, and Mexico have made U.S. stocks even worse. The drop was caused by signs that the economy was already weak. The US businesses have been anxious about Trump’s tariffs. The reality of the matter continues to be unveiled. Will Mr. President listen?
The US market’s current situation
Now, goods coming from Canada and Mexico will be taxed at 25%, and energy items from Canada will be taxed at 10%. Trump raised the 10% tariff he put on Chinese goods to 20%.
The retaliation was quick. In response to the new U.S. tariffs, China said it would put extra tariffs of up to 15% on imports of key U.S. farm goods like chicken, pork, soy, and beef. It also said it would make it harder to do business with certain U.S. companies.
In addition, Canada is planning to impose tariffs on more than $100 billion worth of American goods over the next 21 days. Mexico also wants to tax goods that come from the U.S. However, Trump isn’t worried.
According to him, tariffs can encourage foreign companies to open factories in the US, which means inflation won’t be as bad as experts say it will be.
Trump said on Monday that Taiwan Semiconductor Manufacturing Company, which makes computer chips, would invest $100 billion in domestic production in the United States. However, moving companies around the world and training workers can still take time.
As much as other nations have been affected by the tariffs, the US has not escaped its poison. AI stocks have also been affected. Since Trump won, US stocks have gone up and down a lot. Since November 5, Tesla Inc.’s market value has gone up by as much as $730 billion. However, it has already lost more than $600 billion since its record high on December 17.
As the AI trade sways, Nvidia Corp., Alphabet Inc., Microsoft Corp., and Amazon.com Inc. are some of the companies whose market caps have dropped the most.
Oil prices, which fell about 2% to a 12-week low yesterday, have fallen even more today because of Trump’s tariffs. Brent futures were down $1.04, or 1.45%, to $70.58 a barrel, and U.S. West Texas Intermediate (WTI) oil was down 73 cents, or 1.7%, to $67.64 a barrel.
The crypto market responds to Trump’s tariffs
A day after cryptocurrencies surged on excitement surrounding Donald Trump’s US Crypto Strategic Reserves, the market suffered a dramatic crash, wiping out $300 billion in value. Bitcoin has lost 7.3% in the last 24 hours, going from a high of $93,600 to a low of $83,300.
BTCUSDT one-hour price chart. Source/Tradingview
Big altcoins have also experienced a decline. For instance, Ethereum (ETH) fell by 8.5%, Solana (SOL) fell by 12.5%, XRP fell by 7.9% 15%, and the biggest memecoin DOGE fell by 10.6%. The overall crypto market cap has fallen by 6.77%, now standing at $2.77 trillion, erasing Monday’s gains.
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This articles is written by : Nermeen Nabil Khear Abdelmalak
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