U.S. Stocks Plunge Over 2.5% as Tech and Semiconductor Shares Tumble

U.S. stock markets experienced a significant downturn, with the Dow Jones Industrial Average plummeting over 1000 points, marking a 2.5% decline. The Nasdaq Composite Index fell by 4.31%, while the S&P 500 Index closed down 3.46%, at one point dropping more than 6%.

Large-cap technology stocks were among the hardest hit. Meta Platforms Inc. fell over 6%, while NVIDIA Corporation and Amazon.com Inc. each dropped more than 5%. Apple Inc. saw a decline of over 4%. Tesla Inc. also experienced a significant drop, falling over 7%. Tesla CEO Elon Musk previously commented on the impact of tariffs, stating that the company is not unaffected. He noted that tariffs would increase the cost of components sourced from other countries, significantly impacting Tesla's expenses. Many of Tesla's components are sourced from China, Mexico, and Canada.

Semiconductor stocks also faced a downturn. Micron Technology Inc. fell over 10%, Intel Corporation dropped over 7%, and Taiwan Semiconductor Manufacturing Company Ltd. declined nearly 5%. The Philadelphia Semiconductor Index fell nearly 8%.

Former U.S. Treasury Secretary Janet Yellen criticized the Trump administration's economic policies, describing them as the "most severe act of self-harm" she has ever seen. Yellen, who served as the Chair of the Federal Reserve under the Obama administration and as Treasury Secretary under the Biden administration, made these remarks during an interview with a U.S. cable news network. She highlighted that the new tariffs and other economic policies implemented by the Trump administration have increased the risk of a U.S. economic recession. Yellen warned that these policies could increase the annual expenditure of an average American household by nearly $4,000. She also expressed concern about the significant uncertainty facing the U.S. economy, which could deter long-term investments and lead to a reduction in both investment and consumer spending, potentially triggering an economic downturn.

Yellen emphasized that the Trump administration's cuts to public service agencies such as the Social Security Administration and the Internal Revenue Service, as well as reductions in government programs like healthcare subsidies and food assistance, could harm low-income families. She described these policies as highly destructive. Former U.S. Treasury Secretary Lawrence Summers had previously warned about the risk of a U.S. economic recession, citing the Trump administration's tariff measures as a potential cause. Summers suggested that these policies could result in approximately 2 million job losses and a $5,000 income loss per household.