United States benchmark averages fell sharply on Thursday (Friday AEDT), hitting fresh six-month lows amid a deepening three-week market slump as fresh tariff threats from President Donald Trump unsettled investors.
The Dow Jones Industrial Average slid 537.4 points, or 1.3%, to 40,813.6, and the S&P 500 declined 1.39% to 5,521.52, officially entering correction territory. The Nasdaq Composite suffered a steeper drop of 2%, weighed down by declines in Tesla and Apple.
Market sentiment took another hit after Trump threatened to impose 200% tariffs on alcoholic products from the European Union. The move was in retaliation for the bloc’s 50% tariff on whisky.
"This will be great for the Wine and Champagne businesses in the U.S.," Trump stated on Truth Social. He later confirmed that he would not reverse plans for broader tariffs set to take effect on April 2.
Concerns over Trump’s trade policies have roiled markets throughout March, with investors wary of the impact on corporate confidence and global trade.
The week’s losses have been particularly severe, with the S&P 500 and Nasdaq down 4.3% and 4.9% respectively, while the Dow has shed 4.7%, marking its worst week since June 2022.
The Nasdaq has now plunged more than 14% from its recent high, firmly in correction territory.
Despite the market turmoil, economic data provided some encouraging signs on inflation. The February Producer Price Index (PPI) remained flat month-over-month, defying expectations of a 0.3% increase. This followed a softer-than-anticipated consumer price index (CPI) report earlier in the week.
On the bond markets, the 10-year and 2-year Treasury yields were down 1.2% and 0.8% to 4.266% and 3.957%, respectively.
