Markets Plunge Amid Trade Tensions and Fed Independence Fears
Market News 22 APR
At the start of the week, global equity markets came under intense pressure: key indices reversed sharply, turning a single-session pullback into a full-blown sell‑off. The Dow Jones Industrial Average lost nearly 1,000 points, the Nasdaq Composite fell 2.6%, and the S&P 500 slid about 2.4% from last Friday’s close.
Trade tensions. Following renewed tariff threats between Washington and Beijing, Chinese authorities warned they would refuse any U.S. deals that “harm national interests.” Those remarks deepened market fears of further escalation in trade barriers.
Risk of political meddling at the Fed. Rumors that the White House might intervene in Federal Reserve policy—and even consider ousting Chair Jerome Powell—weakened investors’ confidence in the central bank’s independence. Comments by White House economic adviser Larry Kudlow that President Trump had questioned Powell’s tenure triggered a wave of panic.
Dollar and gold. Amid doubts over the Fed’s independence, the U.S. dollar sank to three‑year lows, while gold soared to record highs as investors sought refuge from political risk.
Cryptocurrencies. Bitcoin jumped more than 3%, reaching a 3½‑week peak as a weaker dollar and geopolitical uncertainty drove demand for digital assets.
Rate‑cut futures. Traders trimmed the odds of a 25 bp rate cut at the May 6–7 FOMC meeting to just 16%, signaling they see less chance of imminent Fed easing.
March’s leading indicators surprised on the downside, falling 0.7% month‑on‑month—the largest drop in 17 months versus expectations for a 0.5% decline. That renewed doubts about the economy’s recovery pace and added to market uncertainty.
This week, investors will watch:
Q1 earnings reports from S&P 500 companies (Bloomberg Intelligence consensus shows earnings up 6.7% year‑over‑year, down from 11.1% expected in early November).
U.S. housing data (new and existing home sales), the Fed’s Beige Book, and new orders for durable goods.
Any fresh signals on U.S. trade policy, as talks with the EU and China remain in focus.
Geography of movements: mixed picture abroad
European markets were closed for Easter Monday, while in Asia the Shanghai Composite rose 0.45% to a two‑week high, even as Japan’s Nikkei 225 fell 1.3%.
Sectors and leaders of decline
The “Magnificent Seven.” Tech giants were under heavy pressure: Tesla fell over 5%, Nvidia dropped more than 4%, and Amazon and Meta each declined over 3%.
Chipmakers. Marvell, ARM, and AMD each lost between 3% and 4%, dragging down the broader semiconductor sector.
Health insurers. UnitedHealth, Humana, and Molina Healthcare slid between 6% and 10% after UnitedHealth Group cut its profit guidance.
Energy. Stocks of oil & gas producers—including APA Corp and Diamondback Energy—tumbled 4–5% as WTI oil prices slipped.
This week’s sell‑off ranked among the sharpest in recent months, driven by a cocktail of geopolitical risk, doubts over Fed independence, and weak macro data.