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Stock market today: Nasdaq, S&P 500 lead losses as market sell-off accelerates
- Economists are growing more concerned about the path forward for the US economy as President Trump’s tariff policies become reality.
- In a research note on Monday, Goldman Sachs chief economist Jan Hatzius slashed his team’s 2025 GDP forecast to 1.7% from 2.4% while boosting their projection for the Fed’s preferred inflation gauge to end the year at 3%, up from a prior call in the mid 2% range. Hatzius noted these updates mark the first time in about two and a half years that his team has projected GDP growth below Bloomberg consensus data (which currently calls for above 2% growth).
- “The reason for the downgrade is that our trade policy assumptions have become considerably more adverse,” Hatzius wrote.
- Hatzius’s team now sees the average US tariff rate rising by 10 percentage points this year, twice their previous forecast and five times the level seen during Trump’s first administration. Tariffs weigh on the overall economic outlook through several levers, Hatzius said.
- First, the new duties are expected to push up consumer prices and, therefore, cut real income for consumers. Second, they usually come alongside tighter financial conditions. And third, the uncertainty surrounding the tariff implementation will likely prompt businesses to “delay investment.”
- Hatzius believes the combination of slower growth and sticky inflation can still leave room for the Federal Reserve to cut twice this year in June and December. But for now, Trump’s policy uncertainty likely keeps the central bank holding rates steady.
- “Our near-term view is that the FOMC [Federal Open Market Committee] will want to stay on the sidelines and make as little news as possible until the policy outlook has become clearer,” Hatzius said.
- Yahoo Finance’s Ben Werschkul reports:
- Read more here.
- Tesla stock (TSLA) tumbled more than 9% on Monday to its lowest level since the day before the presidential election as tech stocks led a market-wide sell-off.
- The EV giant hovered near $237 per share, erasing all of its post-election gains.
- The “Magnificent Seven” stocks led a broader market sell-off on Monday as the Nasdaq Composite (^IXIC) fell roughly 3% by mid-morning
- AI chip giant Nvidia (NVDA) declined, along with Alphabet (GOOG, GOOGL), Amazon (AMZN), and Meta (META).
- Yahoo Finance’s Brian Sozzi reports:
- Read more here.
- Mortgage giant Rocket Companies (RKT) announced Monday it struck a deal to purchase digital real estate brokerage Redfin (RDFN) in an all-stock deal valued at $1.75 billion.
- Redfin stock rose as much as 76% on the news. Rocket stock fell as much as 10%.
- According to a statement announcing the deal, Redfin shareholders will receive just less than 0.8 shares of Rocket stock for each share of Redfin owned. Current Rocket shareholders will own about 95% of the combined company.
- Rocket shareholders will receive a special cash dividend of $0.80 per share. The deal values Redfin at $12.50 per share.
- The companies said the combined company should be able to cut about $140 million of operations and other costs by 2027 and realize an additional $60 million in savings from pairing Redfin agents with Rocket’s financing infrastructure.
- The deal was approved by the boards of both companies and is expected to close in the second or third quarter of 2025.
- Upon the agreement, Redfin CEO Glenn Kelman will continue to run Redfin’s business, reporting to Rocket Companies’ CEO Varun Krishna.
- Selling on Wall Street resumed on Monday following the worst week for the S&P 500 since September as Wall Street continues to price in a potential economic impact from the Trump administration’s evolving tariff policy.
- The “Magnificent Seven” stocks led the sell-off as the Nasdaq Composite (^IXIC) fell roughly 2% after slipping into correction territory last Thursday. The S&P 500 (^GSPC) tumbled 1.5% while the Dow Jones Industrial Average (^DJI) also sank nearly 1%.
- Shares of Nvidia (NVDA), Tesla (TSLA), Alphabet (GOOG, GOOGL), Amazon (AMZN), and Meta (META) were all down more than 2% in early trading.
- Meanwhile, Morgan Stanley’s Michael Wilson joined the group of strategists sounding the economic risk alarm over President Trump’s tariff policies.
- Wilson forecast the S&P 500 could drop as much as 5% in the first half of the year due to the impact of levies and less fiscal spending.
- US stock futures accelerated losses 30 minutes before the opening bell as economic concerns mounted ahead of Wednesday’s inflation report.
- Dow Jones Industrial Average futures (YM=F) fell 1.1%, while futures attached to the benchmark S&P 500 (ES=F) dropped 1.4%. Futures tied to the Nasdaq (NQ=F) plummeted 1.6%.
- Stocks continued a rough start to March after the Nasdaq Composite entered correction territory last week while the S&P 500 logged its worst week since September.
- Crypto also saw losses in premarket trading, as President Trump’s crypto reserve announcement last week did little to ease sentiment. Bitcoin dropped nearly 2% to trade around the $83,000 level.
- Shares of Tesla (TSLA) also dropped 3.8% and Nvidia (NVDA) lost 2.7%, weighing on markets. Reddit (RDDT) stock extended heavy losses, down about 4.7%.
- Ford stock (F) fell over 1% in premarket trading after the automaker announced a 4.4 billion euro ($4.76 billion) investment into its struggling German business.
- Reuters reports:
- Read more here.
- From Bloomberg:
- Read more here.
- US stocks could fall an additional 5%, driven by concerns over tariffs impacting corporate earnings and reduced fiscal spending, warns Morgan Stanley’s Michael Wilson.
- Bloomberg news reports:
- Read more here.
- Gold (GC=F) remained strong following a week of gains as market jitters caused by global economic uncertainty led to haven demand.
- Bloomberg reports:
- Read more here.
- Oil prices dropped as disappointing economic data from China highlighted a bleak demand outlook, while broader markets reflected a reticence to take on risk.
- Bloomberg reports:
- Read more here.
