Wall Street took a beating Monday as all three major stock markets saw huge drops amid fears of a recession and a potential government shutdown.
The Dow Jones Industrial Average finished down by 890 points to 41,911.71, a 2% drop that erased gains made since last November.
Things were even worse in the tech-heavy Nasdaq Composite, which took a 4% dive with a 727-point loss to finish the day at 17,468.32. The S&P 500, always a bellwether for American economic health, suffered a 2.7% decrease Monday, finishing the day at 5,614.56, 2.7% lower than it had been when the market closed on March 7.
Like warning lights on a dashboard, Monday’s market downturn — which continued a steep selloff from last week — seemed to indicate trouble ahead for the American economy nearly two months into President Trump’s second administration.
On Sunday, President Trump declined to comment on the negative market reaction to his on-again, off-again tariff actions against the biggest U.S. trading partners and whether anxieties related to his erratic policy shifts could nudge a softening economy into recession.
HSBC also downgraded U.S. stocks, citing uncertainty around tariffs. China’s retaliatory tariffs on select U.S. imports were set to take effect on Monday, while U.S. tariffs on certain base metals are anticipated later in the week.
Adding instability to the mix, lawmakers on Capitol Hill are scrambling to pass a spending bill to avert a government shutdown. The House, Senate and White House are all under Republican control — but with the GOP having a razor-thin majority in the House, a spending bill could fail if a handful of Republican members oppose it.
A potential government shutdown could reap even further damage to the economy.
