U.S. Stocks Plunge Amid Trump’s Criticism of Fed's Powell

U.S. stocks fell sharply as President Trump's criticism of Fed's Powell sparked investor fears over the central bank's credibility. All major indexes suffered losses, with tech stocks like NVIDIA and Tesla leading the decline.

Date: 23-04-2025

AI Rating: 4

Stock Market Overview
U.S. stocks ended sharply lower due to escalating political tensions affecting investor confidence. President Trump's remarks regarding Federal Reserve Chairman Jerome Powell raised concerns about the potential independence of the central bank. A gloomy backdrop was painted as the major indexes recorded significant losses, with the Dow down by 2.5%, the S&P 500 down by 2.4%, and the Nasdaq down by 2.6%. All major sectors faced declines, particularly technology, consumer discretionary, utilities, and telecommunications stocks.

Impact of Trump’s Comments
Trump's continuous criticism of Powell, emphasizing the need for immediate interest rate cuts, further fueled fears of a potential economic slowdown. The tension surrounding the Federal Reserve's independence impacts the market sentiment significantly. Investors are apprehensive about uncertain monetary policies, which could lead to volatility in stock prices especially in sectors sensitive to interest rate changes.

Sector-specific Performance
The technology sector, notably affected, saw major drops in key stocks with NVIDIA Corporation witnessing a 4.5% decline, while Tesla, Inc. fell 5.8%. Amazon.com, Inc. also reported a 3.1% decrease in shares. These declines can be attributed to the broader fear surrounding economic growth and future cash flows. Given the tech sector's sensitivity to rising interest rates, continued pressure from political commentary could lead investors to reassess their positions in these stocks.

Market Dynamics
The overall market decline was further exaggerated by persistent concerns regarding U.S.-China trade relations and a reduced trading volume. The CBOE Volatility Index (VIX) spiked by 14.06% to 33.82, indicating increased market uncertainty and trader sentiment leaning towards risk aversion. As first-quarter earnings reports loom, investor reactions could further dictate the direction of the market.

Stocks: NVDA TSLA AMZN