Stock markets faced intense volatility on Monday as escalating tariff concerns rattled investors. All three major indices opened in negative territory, with the Nasdaq Composite leading the decline, dropping 2.2%. The S&P 500 was not far behind, slipping 1.2%, while the Dow Jones Industrial Average shed 290 points.
Despite the broad selloff, a few sectors managed to stay afloat, with consumer staples rising 1% alongside select defensive stocks. Meanwhile, gold prices climbed 1%, as investors sought refuge in safe-haven assets amid economic uncertainty.
Tech Stocks Weigh on Nasdaq Composite
The Nasdaq’s sharp decline was fueled by major losses in the technology sector, particularly Nvidia (NASDAQ: NVDA) and Tesla (NASDAQ: TSLA).
- Nvidia, a semiconductor giant, plunged 5% on Monday, extending its five-day loss to 13.5% as concerns over tariffs disrupting the tech supply chain weighed on sentiment.
- Tesla continued its downward spiral, falling 6% in early trading, with its year-to-date losses approaching 40%.
Auto Parts Retailers Defy the Market Trend
Amid the market downturn, O’Reilly Automotive (NASDAQ: ORLY) and AutoZone (NYSE: AZO) emerged as rare gainers.
- O’Reilly rose 2%, benefiting from the growing sentiment that auto parts and used-car retailers could thrive in a high-tariff economy. With Trump’s proposed 25% tariffs on imported vehicles, consumers may opt to repair existing cars or purchase used vehicles rather than absorb the rising costs of new ones.
- AutoZone followed suit, climbing 1.3%, supported by the same trend favoring the auto-parts sector.
Market Performance Overview (Morning Trading)
- Dow Jones Industrial Average: ↓ 291.86 points (-0.70%)
- Nasdaq Composite: ↓ 404.12 points (-2.31%)
- S&P 500: ↓ 74.28 points (-1.3%)
Sectors and Stocks in Focus
Winners: Defensive Stocks Gain Amid Volatility
With tariffs threatening economic growth, defensive sectors like consumer staples and auto parts saw gains, as investors shifted focus to less cyclical businesses.
Losers: Big Tech, Pharma, and Airlines Struggle
- Moderna (NASDAQ: MRNA) suffered a 12.5% loss, as concerns over new pharmaceutical tariffs weighed heavily on the sector. Additionally, the resignation of the FDA chief created uncertainty about future regulatory policies.
- United Airlines (NASDAQ: UAL) fell nearly 7%, despite receiving FAA approval to integrate Starlink internet access into its fleet. Airline stocks remained under pressure amid concerns over rising operational costs.
- Palantir Technologies (NASDAQ: PLTR), a prominent AI and data analytics firm, slid 4.3%, approaching the $80 mark after hitting a 52-week high of $125.
Conclusion: Tariff Jitters Keep Markets on Edge
With tariff tensions looming large, the markets remain highly volatile. The tech-heavy Nasdaq Composite has been hit the hardest, while auto parts retailers have emerged as defensive plays in the current environment. As investors seek stability, gold prices continue to rise, underscoring concerns about economic uncertainty.
Market watchers remain cautious as they await further developments on the tariff front, which could dictate future trends across multiple sectors.