Wall Street Sinks on U.S. Recession Fears; Tesla Plunges 15%
Wall Street’s major indices suffered sharp losses on Monday as investors accelerated sell-offs following an interview with U.S. President Donald Trump that heightened concerns over the economy.
The Dow Jones fell 2.08% to 41,911.71, while the S&P 500 dropped 2.70% to 5,614.56. The tech-heavy Nasdaq Composite led the declines, sinking 4% to 17,468.32.
In a Sunday interview with Fox News, Trump avoided addressing recession concerns, instead calling the current economic phase a “transition period” aimed at “bringing wealth back to the United States.”
Tech Stocks Lead the Sell-Off
High-valuation tech stocks bore the brunt of the sell-off, with Tesla—led by Trump advisor Elon Musk—tanking 15.43% after weak sales data added pressure.
The rest of the “Magnificent Seven” tech giants also declined:
- Nvidia (-5.07%) led the drop, followed by
- Apple (-4.85%),
- Meta (-4.42%),
- Alphabet (-4.41%),
- Microsoft (-3.34%), and
- Amazon (-2.36%).
The tech rout reflects growing market fears over a potential recession and the impact of Trump’s tariff policies on prices.
Meanwhile, the VIX index, known as Wall Street’s “fear gauge,” surged 24% to 29.03 points, signaling heightened market anxiety.
Bond Yields Plummet as Investors Bet on Fed Rate Cuts
Treasury yields tumbled amid growing bets that an economic slowdown will force the Federal Reserve to cut interest rates. The U.S. risk premium spiked, prompting over 10 highly rated companies to delay bond sales.
All Eyes on Key Inflation Report
Markets are now bracing for Wednesday’s February Consumer Price Index (CPI) report, the first full-month inflation data under the new Trump administration. January inflation surged at its fastest pace since August 2023, adding to uncertainty about the Fed’s next move.
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