Wall St tumbles on tariff worries; Nvidia and Tesla drop

Wall Street stocks tumbled on Wednesday, dragged down by losses in Nvidia and Tesla as investors awaited information about forthcoming U.S. tariffs expected to be enacted next week.

In the latest development, a report said U.S. President Donald Trump was readying an announcement on auto levies as soon as Wednesday. Trump suggested on Monday that not all proposed tariffs would be enforced in an upcoming April 2 announcement.

Tesla dropped 6.2%, while shares of other automakers also fell, with Ford Motor and General Motors both down almost 2%.

Uncertainty about the scale of U.S. tariffs, retaliatory measures from trading partners, and the potential ripple effects on the global economy and businesses have kept investors on edge over the past month.

“You can see where uncertainty can result in paralysis in terms of spending, whether it’s a consumer, whether it’s a business,” said Bill Northey, senior investment director at U.S. Bank Wealth Management in Billings, Montana. “If there is a deferral of investment or spending decisions, consumption decisions, then that has a real economic knock-on effect that we need to think about.”

Heavyweight chipmaker Nvidia fell 6%, while Broadcom lost over 5%, sending the PHLX chip index down almost 4%.

The S&P 500 was down 1.19% at 5,708.02 points. The Nasdaq declined 2.06% to 17,894.83 points, while the Dow Jones Industrial Average was down 0.45% at 42,397.65 points.

Of the 11 S&P 500 sector indexes, seven declined, led lower by information technology, down 2.72%, followed by a 1.71% loss in consumer discretionary.

The S&P 500 energy sector index added 0.5% as crude prices climbed, with investors pricing in tighter global supply following the U.S. threat of tariffs on nations buying Venezuelan oil.

A survey revealed a decline in optimism among top business executives in the first quarter.

Businesses wary of tariff-related price hikes scrambled to build up inventories. Data showed an unexpected increase last month in orders for durable U.S. manufactured goods.

Further contributing to market unease, Barclays revised its S&P 500 target downward to 5,900 points from 6,600. The S&P 500 has lost 3% so far in 2025, while the Nasdaq is down over 7%.

The main focus of this week will be the personal consumption expenditures price index - the Federal Reserve’s favored inflation gauge - due on Friday.

Minneapolis Fed President Neel Kashkari said he was uncertain about the effect of Trump’s tariffs, with the possibility they could push up prices arguing for higher interest rates.

Dollar Tree rose 3.6% after the discount-retail chain said it is nearing a sale of its Family Dollar business to a consortium of private equity investors for about $1 billion.

GameStop jumped 14% following its board’s unanimous approval to incorporate bitcoin as a treasury reserve asset.

Declining stocks outnumbered rising ones within the S&P 500 by a 1.1-to-one ratio.

The S&P 500 posted 16 new highs and 6 new lows; the Nasdaq recorded 29 new highs and 164 new lows.

Short interest on the Nasdaq rose about 2.2% in mid-March, the exchange said in a statement released late on Tuesday.

As of March 14, short interest rose to about 15.66 billion shares, compared with 15.33 billion shares at the prior settlement period, which was Fed. 28.

Investors who sell securities ‘short’ borrow shares and then sell them, expecting the stock to fall so they can buy the shares back at the lower price, return them to the lender and pocket the difference.

Shorting can also be part of a hedging strategy.

U.S. crude oil inventories fell last week as refiners continued to ramp up production, while gasoline and distillate stockpiles also dropped, the Energy Information Administration said on Wednesday.

Crude inventories fell by 3.3 million barrels to 433.6 million barrels in the week ended March 21, the EIA said, compared with analysts’ expectations in a Reuters poll for a 956,000-barrel draw.

Refinery crude runs rose by 87,000 barrels per day, while refinery utilization rates inched up by 0.1 percentage point to 87% of total capacity, increasing for a third week in a row as refiners exit seasonal maintenance.

“We are seeing some pick up from increasing refinery utilization,” said Josh Young, chief investment officer at Bison Interests.

After the data, Brent crude futures and U.S. West Texas Intermediate crude futures were up more than 1% on the day at $73.88 a barrel and $69.93 a barrel, respectively.