Dow drops over 200 points as Wall Street reacts to Trump’s tariffs

DDM News

(DDM) – US stocks closed mixed on Thursday as President Donald Trump’s newly launched sweeping tariff measures unsettled investors and sparked fresh questions about the long-term impact on the economy.

The Dow Jones Industrial Average fell 224 points, or 0.51%, while the S&P 500 slipped 0.08%.

The tech-heavy Nasdaq, however, managed a 0.35% gain, closing at a record high despite volatility throughout the session.

DDM gathered that stocks initially opened higher, with the Dow climbing as much as 305 points, or 0.69%, before reversing course as traders weighed the economic implications of the tariffs.

The Budget Lab at Yale University noted that the average tariff rate on US imports is now at its highest level since the 1930s.

Market analysts say the uncertainty around the policy’s effects on inflation, jobs, and global trade is making investors cautious.

“There’s just a lot of questions about what their economic effect is going to be, whether that’s on inflation or on employment,” said Thomas Martin, senior portfolio manager at Globalt Investments.

He added that high market valuations could make stocks vulnerable to pullbacks when uncertainty rises.

Gold prices climbed 1% during the session, with the precious metal acting as a safe haven for investors seeking stability amid policy-driven turbulence.

Earnings season has also shaped trading sentiment.

As of Thursday morning, 87% of S&P 500 companies had reported their second-quarter results, with 81% beating Wall Street estimates, according to data from FactSet.

However, some analysts caution that after strong earnings gains, the bar for further market rallies is higher.

“The market almost is trying to take a breather,” said Angelo Zino, technology analyst at CFRA Research.

“It’s one of those situations where you kind of have to digest some of that stuff,” he noted.

Investors were also rattled by sector-specific disappointments.

Shares of pharmaceutical giant Eli Lilly tumbled 14% after clinical trial results for its highly anticipated weight-loss pill fell short of Wall Street’s lofty expectations.

The pullback underscored how quickly sentiment can shift when performance misses projections in a high-valuation environment.

Analysts say markets will be watching closely in the coming days to see how businesses, consumers, and trade partners respond to the White House’s tariff push.

With investor sentiment swinging between optimism over corporate earnings and concern over economic headwinds, traders expect volatility to remain elevated in the short term.

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