U.S. stock futures plummeted Sunday evening, with Dow futures initially dropping more than 1,700 points, marking one of the most significant declines since the pandemic-driven selloff in March 2020.
The dramatic decline follows President Donald Trump’s announcement of sweeping tariffs against U.S. trading partners, triggering fears of a global trade war and heightened market volatility. The massive market selloff saw Dow futures eventually settling around 1,500 points lower, representing approximately a 4% decline.
“Dow futures were down just 1,500 points, or 4%, after initially falling more than 1,700 points,” according to market data, highlighting the severity of the decline.
The broader market showed similar stress, with S&P 500 futures falling more than 5% before moderating to a 4.2% loss. Nasdaq futures faced even steeper declines, dropping 5.4%, reflecting particular pressure on technology stocks.
The selloff intensified after China’s retaliatory measures, with Beijing implementing 34% tariffs on all U.S. imports. This economic standoff led to Chinese stocks listed in the U.S. experiencing their worst decline since October 2022, plunging 8.9%.
Market volatility reached levels not seen since the early days of the pandemic, with the CBOE VIX Index surging above 45 for the first time since April 2020. Friday’s trading session saw 90% of S&P 500 stocks decline, indicating widespread market panic.
Adding to investor concerns, Federal Reserve Chair Jerome Powell signaled continued vigilance over inflation, dampening hopes for near-term rate cuts. The economic uncertainty has pushed investors toward safe-haven assets, with the Japanese Yen and Swiss Franc strengthening amid the turmoil.
The market turbulence has prompted major financial institutions to revise their outlook, with firms including Evercore ISI, RBC Capital Markets, Goldman Sachs, and Barclays reducing their equity market targets. Oil prices have also been affected, dropping to a four-year low on Friday.
If current trends persist, the S&P 500 could join the Nasdaq and Russell 2000 in bear market territory, defined as a 20% drop from recent highs. This potential development underscores the severity of the current market conditions and growing concerns about global economic stability.