STOCK/MARKET Alert 4.3.2025 ….Liquidation Day follows “Liberation Day”

My Stock/Market Alert is an event driven brief about a stock OR the market when noteworthy action occurs. Today’s alert is due to a stock market sell-off following President Trump’s “Liberation Day” tariff plan announcement yesterday.

Expect the frequency of my Stock/Market Alert notes to be consistent with meaningful moves in a specific stock held by BAM Portfolios or the stock market in general.

Today’s stock market fall was the worst since the extremes of the Covid-19 2020 crash. Investors felt unprecedented uncertainty then, and a high amount of uncertainty now. It was hoped yesterday’s “Liberation Day” tariff talk from President Trump would bring clarity. Instead, today a Liquidation Day followed Liberation Day. U.S. stocks suffered a blanket of heavy selling during the first hour of trading today, which was clearly telegraphed in after-hour trading yesterday, as I wrote about then. More selling was spurred by what economists are saying are the heaviest policy of taxes on imports into the world’s No. 1 economy in at least a century. Liquidation today on Wall Street was steep and widespread. The Dow Jones Industrial Average plunged nearly 1,700 points, the Nasdaq Composite slumped 6.0%, and the S&P 500 fell 4.8%. See the charts below. I see it as -4/-5/-6/-7/+40% (rounding up) among the major U.S. stock market indices, ranging from the Dow to the Small Cap index (Russell 2000).  Notice how the VIX “Fear Index” spiked, soaring nearly 40%.

Here’s today’s U.S. Market Change by Major Index :

Damage done to stocks today was worldwide, and weakness was seen in nearly every market sector. The administration imposed 10% tariffs on global imports, effective April 5. Higher rates were imposed on specific countries, effective April 9, including a 34% tariff on top of the 20% tariff on imports from China. Japan, Vietnam, and India face tariff rates of 24%, 46%, and 26%, respectively. The EU is subject to a 20% rate. The move escalated fears about an economic slowdown and triggered a slight from risk assets. The small-cap Russell 2000 sank 6.6%, large-cap tech suffered outsized declines, and many discretionary-related industries fell under selling pressure. Slowdown worries also translated into lower oil prices due to fears about softening demand. WTI crude plunged back to $67/barrel, contributing to the decline in the energy sector (-7.5%). It was the worst performer, along with technology (-6.9%) and discretionary (-6.5%).

See the declines today/late yesterday in major foreign market indexes:

As noted, the Dow index fell nearly 1,700 points today. As dramatic as that sounds, history offers perspective showing it is not that bad. For one, remember those points are relative to the level of the index for real meaning. In 2015, for example, when the Dow was 17,000, today’s point decline would have been a 10% market plunge. Note in the graphs below that today’s loss, while no fun, was the fourth most point loss in history, but not in the top 20 biggest single day percent losses.

So, today stock market’s around the world through a tariff tantrum. Volatility rocketed higher as investor fear and uncertainty elevated. Expect more. And, remember stock market volatility goes both ways – – down AND up. We will see eye-popping market moves up. Looking back at extreme market volatility during the Covid Crash offers evidence of that. As you can see in the chart below, there were 4 up days of 7% or greater.

We are now in a market seeing a bottom. That is a process. It will test the patience of all investors. Successful stock trader, Peter Lynch said, “If stocks don’t scare you out, they will wear you out.”