U.S. stocks tumbled on Tuesday, with the S&P 500 closing below 5,000 points for the first time in nearly a year. The index reversed an early rally and ended the session down 1.57%, amid mounting fears over President Donald Trump’s aggressive new tariff policy. Investors had briefly hoped for delays or concessions, but by the end of the day, those hopes had faded.
Market loses $5.8 trillion in four days
Since Trump announced sweeping global tariffs late last week, the S&P 500 has dropped more than 12%, wiping out nearly $6 trillion in market value—marking the worst four-day performance for the index since its creation in the 1950s. The sharp selloff puts the benchmark just shy of entering bear market territory, defined as a 20% decline from recent highs.
Tariff deadline sparks panic
Investors were on edge ahead of a midnight tariff deadline, as White House officials confirmed that 104% tariffs on Chinese goods would take effect as planned. Talks of potential negotiations with nearly 70 countries failed to lift sentiment. Traders grew increasingly nervous about the broader impact of the tariffs on global growth and inflation.
Volatility spikes, earnings season looms
The CBOE Volatility Index (VIX)—Wall Street’s fear gauge—jumped to 52.33, its highest close since March 2020. Meanwhile, eyes are turning to earnings season, set to begin later this week with major banks like JPMorgan and Morgan Stanley reporting. Even if Q1 results hold up, many analysts expect warnings about the economic damage from the tariffs to dominate forward guidance.
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