Day Traders Diary

4/4/25

The stock market had second dramatic down day as China retaliated with new tariffs on U.S. goods, sparking fears President Donald Trump has ignited a global trade war that will lead to a recession. The Dow Jones Industrial Average dropped 2,231 points, or 5.5%, to 38,314 on Friday, the biggest decline since June 2020 during the pandemic. This followed a 1,679-point decline on Thursday and marks the first time it has ever shed more than 1,500 points on back-to-back days. The S&P 500 dropped 5.97% or 322 points to 5,074 with only 14 stocks in the index higher today. Today was the biggest decline for the S&P 500 since March 2020. The benchmark shed 4.84% on Thursday and is now off more than 17% off its recent high, down 9% on the week, its worst week since the breakout of Covid in early 2020. The Nasdaq Composite fell 962 points or 5.8% to 15,587. This follows a nearly 6% drop on Thursday and takes the index down by 22% from its December record, a bear market in Wall Street terminology.

Stronger than expected economic data out this morning did little to help the markets. Federal Reserve Chair Jerome Powell said on Friday that he expects Trump's tariffs to raise inflation and curtail growth which did not help the markets. The 10-year Treasury yield dropped 4 basis points to 4.01%, hitting its lowest level since October. The 2-year Treasury yield shed 5.5 basis points to trade at 3.67%.

In the commodity space, oil was down 6% to a three year low on recession fears. Gold was down 2% today while bitcoin actually rose 2% today.