-S&P 500 fell 2.2%, Nasdaq 100 plunged 3%.
-Fed Chair Powell signaled no rush to cut rates.
-Semiconductor stocks tumbled: Nvidia -6.9%, AMD -7.4%, ASML -7.1%.
-Tesla shares dropped 4.9%, announcing halt in new EV sales in the U.S. market.
-WTO downgraded 2025 global trade volume forecast to -0.2%.
Opinion
Chair Powell's hawkish stance dashed hopes for an imminent rate cut, triggering a broad risk-off move across equities. The accelerated tech selloff, driven by worsening U.S.-China tensions over semiconductor exports, has intensified market uncertainty. Rising signs of preemptive consumer spending ahead of tariff impacts also suggest that a potential slowdown in consumption could weigh on future growth.
Core Sell Point
The combination of Fed hawkishness and escalating U.S.-China tech tensions is fueling widespread selling, particularly in the tech-heavy U.S. stock market. Investors should brace for heightened volatility and more defensive positioning ahead.
Wall Street suffered another broad sell-off on Wednesday as Federal Reserve Chair Jerome Powell warned that trade tensions could stoke inflation, suggesting that the Fed would not move quickly to cut rates.
The S&P 500 briefly fell as much as 3.3% before closing down 2.2%, while the Nasdaq 100 slid 3%. Selling pressure was widespread, with around 90% of S&P 500 constituents declining. Losses deepened following Powell’s remarks.
Semiconductor stocks were hit hardest after the Trump administration moved to block chip exports to China. Nvidia and AMD both warned of significant revenue hits, with Nvidia anticipating a $5.5 billion charge and AMD expecting up to $800 million. Meanwhile, ASML missed earnings expectations, citing uncertainty from the new tariff landscape. The Philadelphia Semiconductor Index closed down 4.1%.
During his speech at the Economic Club of Chicago, Powell stressed that the Fed must prevent tariffs from causing persistent inflation and warned of sustained market volatility ahead. He reiterated that without price stability, the U.S. cannot achieve a strong labor market over the long term.
Adding to the bearish mood, the WTO slashed its 2025 global trade growth forecast to -0.2%, citing U.S. tariff escalation and mounting global uncertainty.
Bloomberg Intelligence noted that chipmakers are now leading the broader tech selloff, while Tesla shares slumped 4.9% after reporting weaker new EV registrations in California, despite a rush of purchases ahead of new tariffs.
The S&P 500 entered a phase of relative stabilization after six consecutive sessions of 4% swings—the longest streak of extreme volatility since the March 2020 pandemic selloff.
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