The stock market tumbled to fresh multimonth lows after President Donald Trump announced sweeping new tariffs on the world that far exceeded expectations. Losses were widespread, with only a few defensive areas holding up. Crude oil and Treasury yields plunged.
Tesla reported Q1 deliveries were well below lowered expectations, with the worst quarter in nearly three years. Meanwhile, China EV rivals easily outpaced Tesla, especially rivals BYD, XPeng, Xiaomi.
Stock Market Dives On Trump Tariffs
The stock market suffered its worst week in years as President Trump's tariffs on the world were much higher than expected, followed by strong retaliation from China. The Dow Jones, S&P 500 and Nasdaq are plunged to multimonth lows, while the Russell 2000 is at a 52-week low. The Nasdaq and Russell are in bear market territory. A few defensive areas held up, but selling was wide and deep. The 10-year Treasury yield dived well below 4%. Crude oil plunged to a multiyear low on demand fears and OPEC+ speeding up planned production hikes.
Powell Wants More 'Clarity'
Fed chief Jerome Powell said that tariff increases will be "significantly higher than expected," and is likely to have a bigger effect in raising inflation and slowing growth. He now says tariffs' impact on inflation
Still, Powell said, "We are well positioned to wait for greater clarity before considering any adjustments to our policy stance."
Trump Tariff Rout: Nasdaq In Bear Market; Resilient Stocks Hunted Down
Jobs Report Still Solid, But ...
March hiring topped forecasts by nearly 100,000, with a net gain of 228,000 payroll jobs, including 209,000 in the private sector. However, job gains were revised lower by a combined 48,000 over the prior two months. The jobless rate edged up to 4.2%, as the ranks of the employed rose by 201,000, but the number of people joining the labor force (232,000) grew a bit faster. The jobs report is based on mid-month surveys. However, the number of people continuing to claim jobless benefits rose by 56,000 to 1.903 million in the week through March 22. That points to slow hiring. Meanwhile, the Institute for Supply Management service sector index fell to a nine-month low of 50.8, as forward-looking order backlogs and export orders contracted. The ISM manufacturing index fell below the neutral 50 level, with new orders falling faster and price pressures surging.
Trump Tariffs Slam Many Stock Market Sectors
President Trump's latest wave of tariffs roiled a slew of sectors. Huge tariffs on goods from Vietnam and other apparel-making countries triggered sell-offs in apparel and footwear makers such as Nike, On Holding and Lululemon Athletica. Apple will have to pay a 54% tariff on iPhones made in China and 26% from India. Boeing sold off, both on supply-chain concerns and future foreign demand. Best Buy, Dell Technologies, HP Inc. and more sold off as they face hefty tariffs for Asian-made electronics. E-commerce plays such as Amazon.com, Shopify and PDD face big import tariffs as well.
Tesla Deliveries Tumble
Tesla delivered 336,681 vehicles in Q1, down 13% vs. a year earlier and the worst quarterly performance since Q2 2022. That was well below sharply-lowered forecasts. Model Y and Model 3 vehicle sales totaled 323,800 units in Q1 while the Cybertruck, Model S and X fell to just 12,881 for the quarter. Meanwhile, the company produced 362,615 vehicles, down 16%. Tesla cited the changeover to the new Model Y affecting production and deliveries, but clearly CEO Elon Musk has had a negative brand impact in the U.S. and Europe. Tesla also deployed 10.4 gigawatt-hours of energy storage products in Q1, soaring 156% vs. Q1 2024. Tesla stock rose on a report that Musk would soon leave his government role with DOGE, but then plunged with the market.
Americans Rush To Buy Autos
In other U.S. auto sales news, consumers appeared to be hustling in Q1 to buy vehicles before auto tariffs hike prices. Ford Motor announced that March sales fell 1% vs. a year earlier, but, hybrid, plug-in hybrid and electric vehicle sales jumped 26% in Q1 over the year-ago period. Ford said it was the best Q1 for pickup sales in more than 20 years. Meanwhile, General Motors reported a 17% Q1 sales gain to 693,363 vehicles, its best Q1 since 2018 with broad-based gains. EV sales soared 94%, but tariffs could affect future supply and demand. Stellantis, parent of Jeep, Ram, Chrysler, Dodge and Fiat, reported its overall sales decline continued in Q1. However, Ram and Jeep vehicles showed some signs of sales strength. But Stellantis said it's closing some Canada and Mexico plants due to Trump tariffs, also affecting some U.S. workers.
BYD Holds BEV Crown As XPeng Soars
Tesla rivals BYD, XPeng, Xiaomi all reported booming Q1 EV sales vs. a year earlier. BYD sold just over one million EVs in the seasonally slow Q1, up 59.8% vs. a year earlier but down 34.3% vs. Q4. BYD easily held the lead in fully battery electric vehicles (BEVs) over T A wave of new models, including self-driving tech and superfast charging should propel BYD going forward. XPeng deliveries skyrocketed 331% vs. a year earlier and actually rose vs. Q4. Handset maker Xiaomi, which will release a Model Y rival this summer, continues to ramp up the SU7 sedan, a Model 3 rival, with sales also likely rising vs. Q4. Li Auto, Nio and Zeekr also reported higher sales vs. a year earlier, outpacing Tesla in China, its strongest market.
Stock Market News In Brief
TG Therapeutics rallied Wednesday after Roche said a high dose of its multiple sclerosis drug didn't make a difference in slowing progression for patients with the relapsing form of the disease. The news is a boon for TG which sells a rival drug called Briumvi. But shares fell for the week.
Axsome Therapeutics tumbled Tuesday after its drug, Sunosi, missed its mark in a study of patients with depression. Now, Axsome is planning to test Sunosi in patients who have depression and excessive daytime sleepiness. The drug, already approved to improve wakefulness in patients with narcolepsy and obstructive sleep apnea, showed some promise in this subset of patients.
Rivian reported Wednesday it delivered 8,640 electric vehicles in Q1, down 36% compared to Q1 2024, and produced 14,611 vehicles. It reaffirmed its 2025 delivery guidance of 46,000-51,000 vehicles. Meanwhile, fellow EV startup Lucid announced Thursday that unit deliveries grew more than 60% to 3,109 in Q1 while it produced 2,212 vehicles with more than 600 additional units in transit to Saudi Arabia for final assembly. Both stocks plunged.
