The New York stock market was rocked by panic selling on Monday after U.S. President Donald Trump’s tariff enforcement.
The tech-heavy Nasdaq plummeted by more than 2.6%, while the Dow Jones Industrial Average, which includes 30 large-cap stocks, nosedived nearly 650 points.
The S&P 500, which best reflects the overall market sentiment, tumbled 1.8%.
Amid the widespread drop in M7 stocks, Nvidia fell by 8.8% due to concerns over tariffs and smuggling.
Market Panic
Investors in the New York stock market went into panic mode toward the end of the trading day.
The Dow posted gains in the morning session, and while it turned negative in the afternoon, the decline was insignificant.
However, things began to change about two hours before the market closed.
Investor sentiment plummeted after Trump announced that, as planned, he would start imposing tariffs on Canada and Mexico on Tuesday. He also stated that, from April 2, tariffs would be levied on imported agricultural products, alongside reciprocal tariffs.
By the closing bell, the Dow Jones Industrial Average plunged 649.67 points (1.48%) to close at 43,191.24. The S&P 500 shed 104.78 points (1.76%), ending at 5,849.72.
The tech-heavy Nasdaq Composite crashed by 497.09 points (2.64%) to finish at 18,350.19.
Underscoring the depth of market fear, the CBOE Volatility Index, often called Wall Street’s “fear gauge,” spiked 3.15 points (16.05%) to 22.78.
Tech Sector Turmoil
Nvidia found itself in the crosshairs of a perfect storm.
On March 2, The Wall Street Journal cited sources and reported that the company’s latest Blackwell chips had been smuggled into China through Malaysia and Hong Kong, raising alarm bells.
Additionally, broader concerns about semiconductor tariffs and Trump’s aggressive trade stance sent Nvidia’s stocks crashing.
The company’s shares plummeted $10.86 (8.69%) to $114.06.
Tesla also continued its downward trend. Although it gained over 2% in the morning, it couldn’t withstand the late-session panic. Its stock reversed course, dropping $8.33 (2.84%) to $284.65.
Apple’s stock fell by $3.81 (1.58%) to close at $238.03, while Alphabet’s slipped $3.27 (1.92%) to $167.01.
Microsoft’s share price fell $8.50 (2.14%) to $388.49, and Meta Platforms’s declined $13.15 (1.97%) to $655.05.
Amazon saw its shares drop $7.26 (3.42%) to $205.02.
Semiconductors Plunge
Intel initially surged on news that Nvidia and Broadcom were entering trials with Intel’s advanced 1.8-nanometer process. However, the broader market sell-off eventually dragged Intel down.
Intel had risen by $1.31 (5.52%) to $25.04 in the morning but ultimately closed down $0.99 (4.17%) at $22.74.
AI server manufacturer Super Micro Computer (SMCI) faced its own set of challenges. Despite avoiding delisting by submitting its financial report on time last week, the company’s stock plummeted 13%.
Investor concerns that SMCI could lose market share to competitors like Dell Technologies and HPE in the rapidly evolving AI server market dragged its stock price lower.
Amid panic selling, SMCI shares nosedived $5.39 (13.00%) to close at $36.07.
Oil Markets React to OPEC+ Decision
International oil prices sharply dropped, continuing their decline from the previous weekend for a second consecutive session.
The Organization of the Petroleum Exporting Countries and its allies (OPEC+) announced plans to increase production starting in April, putting downward pressure on oil prices.
OPEC+ stated that member countries would gradually ease production limits beginning April 1, ending the voluntary 2.2 million barrels per day reduction.
As part of this plan, daily production is set to increase by 138,000 barrels starting in April.
Oil prices were heavily impacted by rising supply and concerns that Trump’s tariff policies could slow U.S. economic growth.
Brent crude, the global benchmark, fell $1.19 (1.63%) to $71.62 per barrel for May delivery contracts.
Meanwhile, West Texas Intermediate (WTI), the U.S. benchmark, dropped $1.39 (1.99%) to settle at $68.37 per barrel for April contracts.
