Recession fears rock Wall Street as S&P 500, Nasdaq hit lowest levels since September

Tech stocks were the worst hit, dragging the Nasdaq nearly 4% lower.

US stocks roiled under selling pressure on Monday, extending its fall from last week as investor concerns grew over a potential economic slowdown after President Donald Trump refrained from ruling out a recession amid the implementation of trade tariffs.

By mid-trading, the Dow Jones Industrial Average tumbled 517 points, or 1.2 percent, while the S&P 500 shed 2.3 percent, and the Nasdaq Composite lost 3.6 percent. Both the broad-based S&P 500 and the tech-heavy Nasdaq fell to their lowest levels since September 2024, worsening the recent market downturn amid ongoing economic uncertainty.

The tech-heavy Nasdaq was hit particularly hard, dragged down by losses in the “Magnificent Seven” stocks—Tesla plunged 10 percent, while Alphabet, Meta, and AI giant Nvidia lost over 4 percent each. This downturn follows last week’s steep losses, where the S&P 500 recorded its worst weekly performance since September, falling 3.1 percent, while the Dow and Nasdaq dropped 2.4 percent and 3.5 percent, respectively.

Worries about a potential recession, fuelled by tariffs imposed by the Trump administration, rattled investor sentiment. A key concern is that elevated tariffs could drive prices higher, making it more challenging for the Federal Reserve to cut interest rates and support economic growth.

Fears of an economic slowdown also rocked banking and retail stocks, with shares of  Costco, Walmart, JPMorgan Chase, Citigroup, Wells Fargo, Bank of America, Morgan Stanley, and Goldman Sachs sliding into losses.

Adding to investor caution is a series of high-value macroeconomic data releases scheduled throughout the week. The New York Fed's consumer expectations survey is set for later today, while the University of Michigan's consumer sentiment reading is expected on Friday. Inflation data will also be in focus, with the February consumer price index (CPI) slated for release on Wednesday, followed by the producer price index (PPI) on Thursday.

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