The stock market took a huge hit on Friday, falling sharply as worries about President Trump’s new tariffs continued to weigh on Wall Street.
The Dow Jones Industrial Average dropped 2,231 points, or 5.5%, by the end of the day. The S&P 500 dropped 6%, and the Nasdaq fell 5.8%. This marked the second day in a row of big losses after Trump’s announcement on Wednesday that the U.S. would impose new tariffs on imports worth up to $600 billion. The unexpected size of the tariffs shocked investors, who were already worried about a global slowdown.
Since its peak in December, the Dow is down about 15%, the S&P 500 is down 17.4%, and the Nasdaq has fallen 23% from its December record.
Trump responded on Truth Social, telling investors to “buy low” and expressing confidence in his policies. However, while some of his officials defended his tariffs, Trump stayed silent on the matter and was seen playing golf in Florida on Friday.
Vice President Vance appeared on Newsmax Thursday and said, “We’re feeling good. Look, I frankly thought, in some ways, it could be worse on the markets, because this is a big transition.”
He added, “We have to remember that for 40 years, American economic policy has rewarded people who ship jobs overseas. It’s taxed our workers, it’s made our supply chains more brittle and it’s made our country less prosperous, less free and less secure.”
However, many critics argue that the tariffs could hurt the economy and cause harm to ordinary Americans. Senator Amy Klobuchar (D-Minn.) said, “President Trump’s tariff tax is raising costs for Americans and creating economic uncertainty. The erratic way these tariffs have been announced, un-announced, and re-announced has made it difficult for families and businesses to plan for the future.”
Klobuchar is also co-sponsoring a bipartisan bill this week that would give Congress more control over trade policies.
Trump also added to Wall Street’s concerns by criticizing the Federal Reserve and its chair, Jerome Powell. On Truth Social, Trump urged Powell to cut interest rates, calling it a “PERFECT time” to do so.
Trump wrote, “A BIG WIN for America. CUT INTEREST RATES, JEROME, AND STOP PLAYING POLITICS!”
Later, Powell responded to Trump’s comments, warning that the new tariffs would likely have a bigger impact than expected.
“The tariff increases will be significantly larger than expected…the economic effects will include higher inflation and slower growth,” Powell said. He added, “While tariffs are highly likely to generate at least a temporary rise in inflation, it is also possible that the effects could be more persistent.”
