A day after President Donald Trump announced new tariffs on all U.S. trade partners, markets on Wall Street saw significant sell-offs amid concerns over the future of the U.S. economy.
The Dow Jones Industrial Average plunged by 3.98% at market close Thursday, while the S&P 500 and Nasdaq Composite indexes each saw losses of 4.84% and 5.97%, respectively.
Numerous sectors experienced significant drops. Restoration Hardware, Five Below, and Wayfair were among the companies with the biggest losses in early day trading. Several tech companies and other major corporations such as Dollar Tree, Nike, and Target also suffered significant losses.
Gary Friedman, CEO of Restoration Hardware, told investors on Thursday that he did not think President Trump would stick with the tariffs.
"I think it’s just a little shocking because we’ve never seen an administration and a leader like Trump," he said. "I mean, it’s impressive, quite frankly. You know, usually, governments move like glaciers, and he’s the opposite. Exactly how it’s gonna play out, I don’t know. I don’t think it’s time to overreact."
However, leaders of other companies have voiced concern that tariffs would cause prices to increase and hurt consumers. Best Buy CEO Corey Berry addressed tariffs last month, saying that price increases are likely.
"While Best Buy only directly imports 2% to 3% of our overall assortment, we expect our vendors across our entire assortment to pass along some level of tariff costs to retailers, making price increases for American consumers highly likely," Berry told investors prior to President Trump's announcement.
Globally, from London to Tokyo, other stock markets also experienced setbacks on Thursday, indicating that it's not just American companies that are concerned about the impact of U.S. tariffs. The United States holds more than one-fourth of the world's economy.
