S&P 500 and Nasdaq extend declines as Nvidia and Tesla stocks crash

The S&P 500 and Nasdaq Composite both dropped hard on Monday, pulling the rest of the market down with them as Nvidia and Tesla got crushed.

This happened while President Donald Trump escalated his attacks on Federal Reserve Chair Jerome Powell, demanding that interest rates be cut immediately. Trump’s public assault, posted on Truth Social, calling Powell “Mr. Too Late, a major loser,” shook investor confidence and triggered a wave of sell-offs.

The Dow Jones Industrial Average sank 925 points, down 2.4%. The S&P 500 also lost 2.4%, while the Nasdaq fell 2.91%, officially re-entering bear market territory.

Losses were led by the so-called Magnificent Seven tech stocks, especially Nvidia, which dropped 5%, and Tesla, which lost 7% by press time. Amazon fell 4%, while Meta Platforms and Advanced Micro Devices both dropped 3%. Even Caterpillar, a major equipment company, slipped 3%.

Markets fell to their lowest levels of the session right after Trump’s statement. The dollar also took a hit, falling to a three-year low. On the flip side, gold surged above $3,400 an ounce, setting a new record high. The panic was clear across every corner of Wall Street.

Trump’s attacks and trade wars shake investor confidence

Analyst Adam Crisafulli from Vital Knowledge said investors were facing “a fresh source of macro anxiety” due to Trump’s threats against Powell. He explained that Powell and other Fed officials were stuck because rate cuts could set off a wave of inflation, especially with tariffs still looming.

Crisafulli added that the current collapse across stocks, the dollar, and Treasury bonds made it clear that Trump’s trade war had started a flight away from U.S. financial markets. He made it clear: this isn’t something any negotiation can fix.

Investor confidence also took another blow from the stalled global trade talks. There’s been no progress, and things with China are only getting worse. Chinese officials warned other countries against entering any trade deals with the U.S. that would hurt China. This added more pressure to a market already battered by tech losses and central bank drama.

Since April 2 — a.k.a Liberation Day — the S&P 500 has lost over 8%. The Nasdaq is down almost 10%, and the Dow is off 9%. The drops haven’t slowed.

Trading data backed up the bloodbath. On the New York Stock Exchange, declining stocks outnumbered risers more than 4 to 1, based on FactSet figures. Still, trading volume was low — only about 14% of the average from the last month by mid-morning.

The Nasdaq saw a slightly less brutal ratio, with losers beating gainers about 3 to 2. But volume there was more intense, at over 27% of its 30-day average. New 52-week lows outnumbered highs by a lot: 147 lows to 40 highs on Nasdaq. The NYSE reported 59 lows against only 25 highs.

Then there’s the Tesla disaster. The company lost 7%, but the real problem, of course, is still Elon Musk himself. Analyst Dan Ives from Wedbush said Musk is at a breaking point. If he stays tied to Trump and the White House, Tesla’s brand will suffer.

But if he leaves, the company could get back its full-time CEO. Ives said, “If Musk leaves the White House, there will be permanent brand damage … but Tesla will have its most important asset and strategic thinker back as full-time CEO to drive the vision, and the long-term story will not be altered.”

Ives made one more point. The company’s next big moment comes Tuesday night when it hosts its earnings call. “The turnaround vision must start this Tuesday night on the earnings conference call for Musk and Tesla,” he wrote.

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