Dow drops 1,400 points, S&P 500 loses 4% as stock market rout on Trump's tariffs worsens: Live updates

Stocks nosedived Thursday, sending the S&P 500 back into correction territory, after President Donald Trump unveiled sweeping tariffs of at least 10% for some countries. The news intensified a recent sell-off and raised the risk of a global trade war that hits the already sputtering U.S. economy.

The broad market index dropped 4%, putting it on track for its worst day since September 2022. The Dow Jones Industrial Average tumbled 1,400 points, or 3.3%, while the Nasdaq Composite fell 5%. The slide across equities was broad, with decliners at the New York Stock Exchange outnumbering advancers by six to one.

Thursday’s moves sent the S&P 500 to its lowest level since before Trump’s election win in November, and also erased nearly $2 trillion from the index.

Shares of multinational companies tumbled. Nike and Apple dropped 13% and 9%, respectively. Big sellers of imported goods were among the hardest hit. Five Below lost 26%, Dollar Tree tumbled 11%, and Gap plunged 20%. Tech shares dropped in an overall risk-off mood, with Nvidia off 7% and Tesla down 5%.

A baseline tariff rate of 10% on all countries goes into effect April 5. Even bigger duties against countries that levy higher rates on the U.S. will be charged in coming days, according to the administration.

“We will charge them approximately half of what they are and have been charging us,” said Trump in a press conference from the White House Rose Garden. “So, the tariffs will be not a full reciprocal.”

That halved figure includes “the combined rate of all their tariffs, non-monetary barriers and other forms of cheating,” he said.

These rates will end up being much higher than what investors had expected for many nations. For example, the effective tariff rate for China will now be 54% when accounting for the new reciprocal rate and duties already levied against the country, the White House clarified to CNBC. Traders had hoped a 10% to 20% rate would be a universally applied cap, not a minimum starting point.

“This was the worst case scenario for tariffs and [they] were not priced-into the markets, which is why we are seeing such a risk-off reaction,” said Mary Ann Bartels, chief investment strategist, Sanctuary Wealth. “The big question is if 5,500 can hold on the S&P 500. If it cannot hold, we may see another 5-10% downside, which could likely point to a bottom of 5,200-5,400.”

Investors turned to Treasury yields in their search for safety. The benchmark 10-year Treasury yield dropped 14 basis points to 4.055%, while global currencies including the yen and euro strengthened sharply against the dollar.

The S&P 500 rose for a third day Wednesday on hopes Trump would not announce a severe tariff plan on the risk it would tip the economy into a slowdown and raise already sticky inflation.

The benchmark has been hit hard since late February with it falling into correction territory — or 10% down from its record — because of the heightened uncertainty caused by Trump’s ongoing tariff announcements. This uncertainty has started to show up in some sluggish economic data, which further pressured stocks by heightening recession fears.

“If he would have come in with just the 10%, I think the markets would probably be up quite a bit right now,” said Larry Tentarelli, chief technical strategist at the Blue Chip Trend Report. “But because the tariffs came in bigger than many expected, I think what that does is it creates more downside volatility right now.”