U.S. Market Volatility to Remain Elevated as Trump Tariff Confusion Prevails

Barry Adams
02 Apr, 2025
New York City

Stock market indexes remained under pressure as uncertainty around Trump tariffs contributed to market volatility, and benchmark indexes extended seven-week losses deeper into correction territory. 

The S&P 500 index decreased as much as 0.3%, and the Nasdaq Composite fell about 0.2%, but both indexes attempted to rebound in listless trading. 

The Trump administration's chaotic launch of the import tax, which has put key trading partners on guard, has stoked fears of a wider trade war and raised fears of stagflation in the U.S. 

With each passing day, more companies are delaying their investment decisions in the hopes of more clarity about U.S. trade policy and rules of engagement. 

Donald Trump's White House has knocked off market sentiment, and benchmark indexes have lost about 10% since mid-February. 

Moreover, economists have lowered the U.S. GDP growth estimate from the annual pace of more than 2% to close to zero amid Trump's trade turmoil and threats to key trading partners and neighbors. 

Without the clarity on the trade front, the job market is likely to cool, business investment is expected to freeze, and foreign investors are expected to delay their plans of investment.

In addition, foreign tourist arrivals are also likely to shrink by as much as 5%, compared to the previous estimate of the increase of 9% in 2025, according to several leading tourism industry analysts.

On the economic front, new orders for manufactured goods increased 0.6% from the previous month in February, the U.S. Census Bureau reported Wednesday.

Private payrolls expanded by 155,000 in March, driven by 132,000 job additions in the service sector, according to the data released by ADP.

The hiring accelerated from February, when companies added an upwardly revised 84,000 jobs.

 

Commodities, Currencies, Indexes, Yields

The S&P 500 index decreased 0.3% to 5,614.53, the Nasdaq Composite edged down 0.2% to 17,403.51, and the Russell 2000 index was down 0.9% to 1,994.73.

The yield on 2-year Treasury notes edged lower to 3.86%, 10-year Treasury notes decreased to 4.12%, and 30-year Treasury bonds declined to 4.49%.

WTI crude oil decreased $0.13 to $71.07 a barrel, and natural gas prices edged higher by $0.08 to $4.04 a thermal unit.

Gold increased by $16.43 to $3,131.65 an ounce, and silver edged up by $0.28 to $33.95.

The dollar index, which weighs the US currency against a basket of foreign currencies, decreased by 0.29 to 103.97 and traded at a two-year high.

 

U.S. Stock Movers 

Tesla decreased 2% to $256.60, and the electric vehicle maker reported fewer than expected deliveries in the first quarter. 

The EV company delivered 336,000 vehicles worldwide, sharply lower than the market estimate between 360,000 and 370,000. 

The company is likely to report a larger decline in the second quarter amid falling sales in California, China, and the European Union. 

XPeng Inc. gained 1.2% to $21.22 after the Chinese electric vehicle maker announced vehicle delivery results for March and the first quarter of 2025.

In March, the company delivered 33,205 electric vehicles, marking a 268% increase year-over-year, surpassing 30,000 units for the fifth consecutive month.

For the first quarter of 2025, XPeng delivered 94,008 EVs, representing a 331% increase compared to the same period last year.

On March 13, the company launched 2025 versions of the XPeng G6 and XPeng G9, and both upgraded versions come standard with 5C AI batteries and Turing AI-powered smart driving features across all trims.

At the same time, XPeng expanded its global presence by entering the Indonesian market.

On March 18, the company announced fourth quarter of 2024 earnings results.

Revenue increased to 16.10 billion yuan from 13.05 billion yuan, net loss shrank to 1.33 billion yuan from 1.35 billion yuan, and diluted loss per share narrowed to 70 cents from a loss of 75 cents a year ago.

Total deliveries of vehicles were 91,507 during the fourth quarter, representing an increase of 52.1% from 60,158 in the corresponding period of 2023.

For the full year 2024, revenue jumped to 40.87 billion yuan from 30.68 billion yuan, net loss shrank to 5.79 billion yuan from 10.37 billion yuan, and diluted loss per share narrowed to 3.06 yuan from a loss of 5.96 yuan a year ago.