4:10pm: Uncertainty mounts across sectors
The stock market had a rough day on Wednesday, with all the major indices taking a hit. The Dow dropped about 700 points, or 1.7%, closing at 39,669 — a broad-based decline, especially in the industrials and financials.
The S&P 500 wasn’t spared either, down 2.2% to 5,276, with weakness showing up in materials and consumer discretionary stocks. Seven out of eleven sectors ended the day in the red. But it was the Nasdaq that really felt the pain, falling 3.1% to 16,307 as tech stocks got slammed, partly due to worries about export restrictions and broader geopolitical tensions.
Even small-cap stocks weren’t immune — the Russell 2000 slipped 1.4%, signaling that investors are feeling uneasy about the domestic outlook too. All in all, the day reflected growing nerves around trade issues, policy uncertainty, and economic data that’s still sending mixed signals.
Looking ahead, the market is bracing for more clues from upcoming earnings and key economic reports like retail sales and inflation. And while things have been relatively calm lately, analysts are warning that volatility isn’t going away anytime soon. Bottom line: it was a tough day for the markets, and investors are staying cautious as the uncertainty continues to swirl.
3:37pm: Nvidia shares caught up in trade war
Nvidia Corp (NASDAQ:NVDA, ETR:NVD) shares dropped 10% in afternoon trading on Wednesday after the company disclosed a $5.5 billion charge tied to tightened US restrictions on AI chip exports to China, raising investor fears about escalating trade tensions and long-term strategic risks.
Analysts at Bank of America called the restrictions “unwelcome but somewhat expected,” estimating a manageable 5% to 8% sales hit and a 6% to 10% drag on earnings for fiscal 2026.
The strategic implications of the restrictions are resonating loudly on Wall Street.
Wedbush called the export curbs a “clear shot across the bow” from the Trump administration, portraying the move as a geopolitical escalation in the ongoing US-China tech battle. “This disclosure is a clear sign that Nvidia now has massive restrictions and hurdles in selling to China,” Wedbush wrote.
“It’s a ‘Do Not Enter’ sign in front of China for Nvidia and Jensen with this restriction.”
2:55pm: Tariffs create 'challenging scenario' says Powell
Federal Reserve chair Jerome Powell has warned the central bank will await “greater clarity” before further cutting interest rates in the wake of US president Donald Trump’s sweeping tariffs.
Speaking at the Economic Club of Chicago on Wednesday, Powell said Trump’s tariffs are highly likely to cause at least a temporary rise in inflation while simultaneously slowing economic growth.
This creates a difficult dilemma for the Federal Reserve, as it must balance its dual mandate of promoting maximum employment and maintaining price stability.
“We may find ourselves in the challenging scenario in which our dual-mandate goals are in tension,” Powell said in prepared remarks.
“If that were to occur, we would consider how far the economy is from each goal, and the potentially different time horizons over which those respective gaps would be anticipated to close.”
US stocks reacted negatively to Powell’s comments, with the Nasdaq shedding 3.9% at 16,162 points, the S&P 500 down 2.6% at 5,253 points, and the Dow Jones down 1.8% at 39,638 points.
1:55pm: Wednesday's headlines
The US Commerce Department unveiled new export restrictions targeting their artificial intelligence chips bound for China. The revised rules impose licensing requirements on Nvidia’s H20 and AMD’s MI308 processors, along with equivalent models, as part of Washington’s ongoing efforts to tighten control over advanced semiconductor technology.
The gold price surged to a new high above $3,300 on Wednesday as financial markets moved money out of riskier assets as US-China trade tension showed little sign of easing.
Tesla Inc (NASDAQ:TSLA) has suspended the import of key components from China for its upcoming Cybercab and Semi electric truck projects in the US due to a sharp escalation in tariffs imposed by president Donald Trump, according to Reuters.
Retail sales increased 1.4% in March, following a modest rise in February and a decline in January.
12:53pm: Gold price 'so compelling'
The fervor surrounding gold isn't showing any signs of slowing down, even as it surges to a new high, says Chris Beauchamp, Chief Market Analyst at online trading platform IG.
“Bullish sentiment continues to abound in gold though, which shows no sign of slowing down," Beauchamp commented.
"It might be the ‘most crowded trade’ according to Bank of America’s latest survey, but so was ‘Long Tech’ for months at a time, and that didn’t stop investors from piling in. All this comes as inflation remains muted for now.
"It is the level of uncertainty in the macro outlook right now that makes gold so compelling.”
12:21pm: Tech rout
Stocks are taking a hit at midday, with tech stocks leading a widespread selloff.
The Nasdaq is down 2.1%, getting hit the hardest thanks to a big drop in chipmakers. Nvidia’s at the center of it, falling more than 6% after revealing a $5.5 billion charge tied to new US export restrictions on its AI chips to China, which is also dragging down other semi stocks like AMD and Micron.
The S&P 500 is down 1.2%, while the Dow is holding up a bit better, off just 0.5%. The Dow’s slightly better performance comes from strength in stocks like UnitedHealth and Travelers, which are helping cushion the blow from tech losses.
In the background, gold is surging past $3,300 an ounce as investors flock to safe havens, and Treasury yields are steady. Meanwhile, retail sales came in hotter than expected for March, up 1.4%, but that positive news is getting lost in the shuffle of tech worries and trade tension.
All eyes now are on Fed Chair Jerome Powell’s next move and corporate earnings as investors try to gauge where the market’s headed from here. For now, the mood is cautious, with concern growing over how US-China trade policies might shake up the tech landscape.
11:22am: March manufacturing uptick
Manufacturing output rose 0.3% in March, modestly exceeding expectations and marking the highest post-pandemic reading for the index. However, Wells Fargo analysts caution the improvement is likely temporary due to growing uncertainty around U.S. trade policy.
"While there's some evidence of tariff front-loading in the March industrial production release, it's somewhat muted and perhaps more importantly likely short-lived," the analysts said.
The overall industrial production figure slipped 0.3%, largely because of a steep 5.8% drop in utilities output. Manufacturing gains were driven by sectors like computers and electronics, aerospace, apparel, and plastics, while chemicals and food & beverage posted smaller increases. Weakness was seen in wood products, petroleum, and textiles.
Wells Fargo pointed to a surge in industrial imports in recent months—driven by manufacturers stockpiling ahead of tariffs—and warned that any disruption to this supply pipeline could weigh on output.
The report also noted that many businesses are pausing capital expenditures amid policy uncertainty, which may further dampen manufacturing momentum.
10:42am: Retail sales show 'solid' underlying demand
US retail sales rose more than expected in March, led by surging auto purchases and broad-based gains, signaling resilient consumer demand despite growing concerns over tariffs and economic uncertainty.
Analysts said the strength was not solely due to pre-emptive buying ahead of tariffs but pointed to solid underlying demand.
“The March retail sales report met expectations on the headline and exceeded expectations after accounting for upward revisions to prior data and a composition of spending that reflects more than just a pre-tariff splurge,” Wells Fargo economists wrote. “The upshot is that Q1 PCE is shaping up to be halfway decent.”
Control group sales—a key input for GDP that excludes autos, gas, building materials and food services—rose 0.4% in March, after a revised 1.3% increase in February, pointing to steady goods consumption.
Jeffrey Roach, chief economist at LPL Financial, said inflation-adjusted retail sales fell slightly over the past three months. “If the economy can hold on during this period of tariff uncertainty, we could see some relief when the Fed eventually loosens monetary policy.”
9.55am: Stocks slide at the open, Nasdaq leading
Wall Street has opened in the red.
The Dow Jones has fallen 0.6%, the S&P 500 has lurched 1.3% lower and the Nasdaq has tumbled 2.1%.
Nvidia and ASML, which reported earnings, are leading the Nasdaq 100 fallers, down close to 6%, with Advanced Micro Devices close behind.
Applovin Corp and Applied Materials Inc are also down over 4%.
8:55am: Retail sales rise
US retail sales rose 1.4% in March, the strongest monthly gain since January 2023 and in line with economist forecasts, pointing to continued consumer strength.
Sales excluding autos and gas increased 0.8%, beating expectations, while the control group—which feeds into GDP calculations—rose a softer-than-expected 0.4%.
February's control group figure was revised higher to 1.3%, adding some momentum to Q1 growth.
The report comes as concerns grow that the US economy may be cooling, even before the full impact of newly announced reciprocal tariffs is felt.
7:20am: Futures down
US tech giants have been tipped to turn the small losses from the previous session into larger ones, despite signs of possible conciliatory moves by China towards opening trade talks.
Well ahead of Wall Street's opening bell, Nasdaq 100 futures were down 1.4%, with those for the S&P 500 0.8% lower, while Dow Jones futures are sitting 0.2% in the red.
Overnight, stocks had swung into reverse gear again, with the Dow dropping 0.4%, the S&P 500 losing 0.2% and the Nasdaq just below flat.
This followed reports that EU trade talks with the US made little progress, meaning 20% tariffs remain for both sides.
China yesterday was also contining to hold back from initiating tariff negotiations, with Beijing also announcing that they will not buy Boeing planes, followed by Washington responding with restrictions on the export of Nvidia’s H20 chips, which are specifically designed for China.
Nvidia Corp (NASDAQ:NVDA) then warned that it will report $5.5 billion in writedowns during this quarter, with Bloomberg estimating a total revenue miss for the company could be $14-18 billion for the year.
Nvidia shares are down 6.5% in premarket trading today.
Asian markets finished mixed in the early hours, while Europe's major stock indices trimmed their losses, with the FTSE 100 in London movingh from a 0.8% decline to 0.35% and Germany's DAX from a 1.3% fall to 0.5%.
This followed a report that China is "open to talks" if Donald Trump and his team "shows respect", per Bloomberg, with Beijing reportedly wanting the US President to "reign in" his cabinet ministers.
Trump was up early and messaging on social media about trade talks, but this was with a different major Asian economy.
"Japan is coming in today to negotiate on tariffs, the cost of military support, and 'trade fairness'," the President said on his Truth Social platform.
"I will attend the meeting, along with Treasury & Commerce Secretaries. Hopefully something can be worked out which is good (GREAT!) for Japan and the USA," he added.
Elsewhere, the gold price surged to a new high above $3,300 as financial markets moved money out of riskier assets