US Stock Market Faces Significant Decline Amid Economic Concerns

The US stock market experienced a steep decline on Thursday, with the S&P 500 officially entering correction territory. This downturn raises alarms about inflation and a potential recession as the tariff conflict intensifies. All three primary US indices concluded the day in the red, primarily driven by a significant selloff in technology stocks, leading the Nasdaq to drop nearly 2%.

Major Index Performance

• Dow Jones Industrial Average: Fell by 537.36 points, or 1.30%, ending at 40,813.57.
• S&P 500: Decreased by 77.78 points, or 1.39%, settling at 5,521.52.
• Nasdaq Composite: Dipped 345.44 points, or 1.96%, closing at 17,303.01.

Among the 11 sectors within the S&P 500, only utilities managed to stay positive. The most significant losses were seen in communication services and consumer discretionary sectors.

Notable Stock Movements

• Intel: Surged by 14.6%.
• Adobe: Experienced a sharp decline of 13.9%.
• Dollar General: Gained 6.8%.
• Tesla: Down by 3%.
• Nvidia: Slight decrease of 0.14%.
• Apple: Fell 3.36%.
• Amazon: Dipped 2.51%.

S&P 500 Correction Status

The S&P 500 has seen a decrease of 10.1% from its record high on February 19, marking a definitive correction. On March 6, the Nasdaq also confirmed it was in correction mode, with a 10.4% decline from its peak on December 16. Moreover, the Dow Jones Transportation index, viewed as a key indicator of the US economy, closed 18.9% below its record high from November 25; a drop exceeding 20% would confirm a bear market.

Tariff War Impacts

The escalating tariff war has led to heightened tensions, with the European Union retaliating against US tariffs on steel and aluminum by imposing a 50% tax on American whiskey exports. In response, the President threatened a 200% tariff on European wines and spirits via social media. A recent Reuters/Ipsos poll revealed that 57% of Americans believe the President’s economic strategies are erratic, and 53% think the tariff conflict could be more harmful than beneficial.

Treasury Yields and Market Reactions

In light of the stock market’s downturn, US Treasury yields saw a decline as investors sought the safety of government bonds. The yield on 10-year notes fell by 3.4 basis points to 4.282%, having previously reached 4.353%, the highest since February 25. Additionally, the 2-year note yield decreased by 4.2 basis points to 3.953%, while the yield curve between two-year and ten-year notes steepened by about one basis point to 33 basis points.

The current economic climate remains uncertain, and investors are keenly observing how these developments will unfold in the coming weeks. For further information on market trends, check out resources from MarketWatch and Bloomberg.