Dow drops more than 500 points as sell-off intensifies following negative GDP data: Live updates

Shares tumbled on Wednesday, spoiling a inventory market comeback in April, as information confirmed the U.S. economic system contracted within the first quarter, elevating fears the economic system was slipping right into a recession beneath the load of President Donald Trump’s flurry of coverage strikes, particularly on commerce.

The Dow Jones Industrial Common fell 518 points, or 1.3%. The S&P 500 was off 1.6%, whereas Nasdaq Composite shed about 2%.

First quarter gross home product declined at a 0.3% price, the Commerce Division mentioned on Wednesday, a fast reversal from a 2.4% improve within the fourth quarter. Imports surged by 41% within the final quarter, subtracting from GDP, as firms sought to get forward of Trump’s world commerce combat. The report additionally confirmed an enormous slowdown in client spending and a decline in authorities spending amid Elon Musk’s DOGE cuts.

A separate report from ADP additionally signaled an financial slowdown, with non-public payroll progress slowing in April to only 62,000 in the course of the month. That was properly under the Dow Jones consensus estimate from economists of 120,000.

The bitter GDP information put a damper on what has been a outstanding comeback in shares for April. Trump’s sweeping “reciprocal” tariff announcement on April 2 despatched the inventory market right into a tailspin, with the S&P 500 down more than 11% at one level for the month and off by practically 20% from its February file. A comeback ensued as Trump walked again the stiffer duties, and the S&P 500 heading into Wednesday was down nearly 1% for the month.

The main averages ended Tuesday greater after Commerce Secretary Howard Lutnick informed CNBC that the White Home was near saying a commerce deal, however did not title the nation. Later within the afternoon, Trump mentioned that tariff negotiations with India are “coming alongside nice” and that the U.S. might quickly strike an settlement with the nation.

However the promoting returned on Wednesday, with the weak GDP report elevating considerations that the chaos attributable to Trump’s coverage flurry might have already pushed the economic system towards a recession earlier than any substantial commerce offers are enacted.

In a put up on Fact Social, Trump blamed a “Biden ‘Overhang'” following the weak numbers, telling individuals to “BE PATIENT!!!” and that his insurance policies “will take some time” to take impact.

“The continuous sequence of coverage reversals has led to very excessive ranges of uncertainty for companies and buyers,” mentioned Scott Helfstein, World X’s head of funding technique. “This report ought to be a canary within the coal mine for the brand new administration, however maybe their willingness to inflict financial ache in pursuit of the long-term targets was underestimated.”

First Photo voltaic shares plunged more than 9% after chief government Mark Widmar mentioned that the president’s tariffs pose a “important financial headwind” for the photo voltaic know-how firm’s manufacturing services, slashing its full-year forecast in response. GE Healthcare additionally lower its outlook for the yr to account for the impression from tariffs.

In the meantime, shares of synthetic intelligence chip darling Nvidia fell more than 2% in sympathy with server maker Tremendous Micro Pc’s 16% decline. Tremendous Micro issued weak preliminary outcomes for the fiscal third quarter.