‘So much winning’ amid black Monday bloodbath – in 9 charts

Markets plunged steeply on April 7, in what analysts dubbed a reincarnation of 1967’s “Black Monday” for global assets, with US equities leading the sell-off and cross-asset volatility rattling investors. Yet even as yields dropped and spreads clocked crisis-era levels, President Donald Trump is “all positive,” beginning the month with a statement that shows he’s not worried.

“We will never stop fighting to put more money back in the pockets of our overburdened taxpayers,” Trump said in a statement. The president pledged to end what he described as waste and abuse in Washington by reviving “the American Dream.”

But as it stands, markets paint a bleaker picture.

Treasury yields post deepest weekly drop since 2023

The US 10-year Treasury yield fell by 25.5 basis points last week, marking the largest weekly decline since mid-2023. 

According to a Deutsche Bank analysis, such a drop, while not unprecedented, signals a rapid flight to safety. The only more severe declines in recent years occurred during major market panics, including the initial COVID shock and the collapse of regional banks in 2023. 

High-yield spreads clock crisis-era extremes

US high-yield bond spreads widened by a staggering 93 basis points over just two trading sessions on Thursday and Friday. That movement level has only been rivaled during some of the most severe financial episodes of the 21st century.

These include the post-9/11 reopening of markets in 2001, the height of the Global Financial Crisis (GFC) in 2008, the US debt ceiling downgrade in 2011, and the March 2020 COVID crash. There’s notably a steep repricing of credit risk across corporate America as investors demand higher premiums to hold speculative-grade debt.

Equities lead Black Monday’s cross-asset carnage

A chart compiled by Goldman Sachs shows the S&P 500 and Nasdaq are among the hardest-hit indexes in the Trump tariff-riddled US economy. Between April 2 and April 4, US equities posted more than 3% declines in standard deviation terms. The S&P 500 Equal Weight Index fared even worse, meaning losses were not confined to the tech sector or large caps.

The S&P 500’s drop placed it at the far-right extreme of the cross-asset spectrum, dropping more than 10% in the last two days of last week’s business week, the 5th-worst performance since World War 2.

Bankruptcy filings on the up

Weekly bankruptcies are climbing, with the 4-week average nearing post-2008 highs. Small businesses and retailers are particularly vulnerable as financing costs rise.

Epiq AACER, a major source of US bankruptcy statistics, says that the number of commercial Chapter 11 bankruptcy filings jumped 20% year-over-year in March 2025. In March 2024, there were 611 applications. Last month, there were 733.

Overall, commercial bankruptcies also increased, climbing 10% to 2,727 from 2,477 during the same period last year. However, small business bankruptcies under Subchapter V of Chapter 11 slightly declined. Filings under that category dipped 1% year-over-year, totaling 196 in March 2025 compared to 198 a year earlier.

Inflation sentiment is also high

Regional Fed surveys point to stubborn price pressures, with the Philly Fed’s “prices paid” index flashing several upside risks to PCE inflation.

The Philadelphia Fed’s Prices Paid Index surged to 48.3 points in March 2025, up from 40.5 in February, marking a month-over-month increase of 19.3%, according to data from the Federal Reserve Bank of Philadelphia. Compared to a year ago, the index has soared by an eye-popping 475%.

Historically, the index has averaged 28.96 points since its inception in 1968. It reached an all-time high of 91.1 in March 1974 and hit a record low of -35.5 in April 2009.

Consumers brace for a job market meltdown

The University of Michigan’s survey reveals that 60% of consumers expect higher unemployment next year, a sentiment not seen since the 2007-2008 Great Recession.

Business confidence crashes to decade lows

A composite index of CEO surveys shows business optimism plummeting almost 30% after the November elections, with March readings at levels last seen during the 2020 lockdowns. Firms cite tariffs, inflation, and policy unpredictability as top risks.

Tariffs could shave 0.2% off US GDP, VIX heightens

New tariffs on China, the EU, and autos may dent GDP by up to 0.2%, with China bearing the brunt. Per the International Monetary Fund, prolonged trade tensions could amplify the drag.

The volatility index (VIX) closed at 45.31, a level surpassed only during COVID-19 and the 2008 crash.

The United States Volatility Index (USVIX) closed at 45.31 last Friday, representing a gain of 15.29 points, or 15.29%, in just one trading session. Over the past four weeks, the index has climbed 23.38%, while its year-over-year increase now stands at 29.28%.

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