Dow Jones futures fell sharply Monday morning, along with S&P 500 futures and Nasdaq futures. President Donald Trump declined to rule out a recession, with tariffs and related uncertainty still in focus for Wall Street.
The stock market suffered damaging losses in the past week, with the Nasdaq composite tumbling below its 200-day moving average. The S&P 500 undercut its 200-day line Friday, but rebounded as Fed chief Jerome Powell said he still sees a "solid" jobs market. Still Trump tariffs news has whipsawed and unnerved markets, with more on the way.
Many old leaders such as Tesla and Nvidia continued to sell off this past week.
Worse, many stocks that had been resilient, including Netflix, Spotify, JPMorgan Chase, Carpenter Technology, DoorDash, Costco Wholesale and Stride, broke below their 50-day lines decisively last week.
A few areas are holding up. But the overall picture is clear: Investors should be very defensive right now.
DoorDash stock, TKO Group, Williams-Sonoma and Expand Energy will join the S&P 500 index as part of a quarterly rebalance, S&P Dow Jones Indices announced Friday night. DASH stock jumped.
Dow Jones Futures Today
Dow Jones futures fell 1.2% vs. fair value. S&P 500 futures declined 1.4% and Nasdaq 100 futures tumbled 1.6%. The S&P 500 is set to open below its 200-day line after testing that level last week.
The 10-year Treasury yield retreated to 4.23%.
Crude oil futures edged higher.
Remember that overnight action in Dow futures and elsewhere doesn't necessarily translate into actual trading in the next regular stock market session.
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Trump Tariffs, Recession
In a Fox News interview that aired Sunday, President Trump declined to rule out a recession this year, saying "There is a period of transition" that will eventually pay off for the economy.
Last Tuesday, President Donald Trump imposed 25% tariffs on Canada and Mexico, along with a further 10% hike on Chinese goods. He quickly provided one-month exemptions for autos and many other goods from Canada and Mexico. But the tariffs and related uncertainty appear to have dented investor and business confidence.
On Thursday, Trump blamed "globalists" for the stock market sell-off.
Commerce Secretary Howard Lutnick said Sunday that he expects 25% tariffs on steel and aluminum to go into effect as scheduled on Wednesday. Meanwhile, a slew of tariff deadlines loom April 2, including the Canada and Mexico exemptions.
Stock Market Struggles
The stock market fell sharply once again, with the Nasdaq breaking the 200-day moving average and many leading stocks cracking. The major indexes reversed higher on Friday following Powell's relatively upbeat comments.
The Dow Jones Industrial Average fell 2.4% in last week's stock market trading. The S&P 500 index lost 3.1%, testing its 200-day line. The Nasdaq composite plunged 3.45% and the small-cap Russell 2000 sold off 4.05%, both hitting five-month lows.
In addition to Trump tariffs fatigue, the Nvidia-led AI stock boom, which drove the market higher for the past couple of years, is at least on hold for now.
On Friday, Fed chief Powell described the current job market as "solid," easing economic fears on Wall Street. Powell said that the central bank can await "greater clarity" on the net effect of Trump policies before making its next move, again signaling he's not especially worried for now.
Friday marks day one of a stock market rally attempt. That'll continue as low as the major indexes hold above Friday's intraday lows. But a correction is in force for now.
Gold plays are faring well amid a tumbling dollar. Some fast-food stocks such as McDonald's are moving higher. China and European stocks have been rallying on stimulus moves there. Several insurance stocks are setting up.
But many other top stocks have been breaking lower. Sure, former leaders such as Nvidia and Tesla kept tumbling. But others that had looked strong sold off below their 50-day lines and sometimes buy points, including Netflix stock, JPMorgan, Costco and Spotify.
The 10-year Treasury yield rose nine basis points to 4.32% for the week after tumbling to 4.11% on Tuesday morning. Odds for Fed rate cuts have picked up considerably, despite Powell's wait-and-see comments.
U.S. crude oil futures fell 3.9% to $67.04 a barrel last week, even with a Friday bounce.
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ETFs
Among growth ETFs, the Innovator IBD 50 ETF plunged 7.3% last week. The iShares Expanded Tech-Software Sector ETF slumped 4.1%. The VanEck Vectors Semiconductor ETF fell 3.3%, with Nvidia stock the No. 1 holding.
ARK Innovation ETF tumbled 5.8% last week and ARK Genomics ETF gave up 5.2%. Tesla stock is still the top component across Ark Invest's ETFs.
SPDR S&P Metals & Mining ETF shed 3.6% last week. The Energy Select SPDR ETF lost 3.9% while the Health Care Select Sector SPDR Fund edged up 0.2%. The Industrial Select Sector SPDR Fund declined 1.5%. The Financial Select SPDR ETF lost 5.9%. JPMorgan stock is a major XLF holding.
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Tesla, Nvidia Dive
Tesla stock dived 10.35% to 262.67, its seventh straight weekly loss and breaking below its 200-day line. On Friday, shares briefly undercut their Nov. 5 Election Day close, round-tripping all the postelection gains. After initial hopes that Tesla would greatly benefit from Elon Musk's close ties with President Trump, there's a growing sense that the brand and sales are suffering as a result.
New Model Y deliveries have begun in the U.S. and Europe, after starting in China late last month. But wait times are relatively short.
Tesla stock fell modestly Monday morning with Musk continuing to post heavily on Ukraine and other issues over the weekend.
Nvidia stock tumbled 9.8% to 112.69 for the week. Shares broke below post-DeepSeek lows and hit their worst levels in six months intraday Friday.
NVDA stock was modestly lower in premarket trade.
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What To Do Now
This would be a good weekend to watch the movie, "Get Out." It's just best to get out and wait for better conditions.
Friday's bounce was nice, but whipsaw action is common in this headline-driven market. The major indexes have staged three upside reversals in the last six sessions, with 1%-plus gains in the first two. But so far those have been blips in a sharp downtrend.
Wait for the market to show sustained positive momentum. That could come next week, next month or even next year. The key is to be ready.
Watchlists will need significant overhauls, with a lot of names coming off. Look for stocks showing relative strength. But as Netflix, Costco, Spotify and others showed this past week, today's resilient stocks can be tomorrow's big losers.
This coming week, inflation reports will be in focus. Meanwhile, a government shutdown looms at midnight Friday if the GOP-led Congress doesn't pass a new funding bill.
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