U.S. stocks suffered their worst two-day decline on record, erasing $6.6 trillion in market value Thursday and Friday as investors reacted to escalating trade tensions and growing fears of a recession.
Since Jan. 17, the Friday before President Donald Trump was sworn in for his second term, roughly $11.1 trillion has been wiped out from the U.S. stock market, according to Dow Jones Market Data.
The staggering $6.6 trillion loss over the past two sessions marks the largest two-day drop in shareholder value ever recorded.
The sell-off accelerated after Trump announced unexpectedly steep tariffs Wednesday, catching many investors off guard. Financial markets have since pressured the administration to either scale back the planned levies or announce progress toward a trade deal, said Kathleen Brooks, research director at XTB, in emailed commentary.
Despite Trump’s attempt to reassure markets — including a post on Truth Social touting a "productive” call with Vietnam’s leader — the broader sell-off continued. Shares of Nike Inc., which has significant manufacturing operations in Vietnam, rose on the news, but the gains did little to offset losses across major indexes.
A stronger-than-expected March jobs report also failed to lift sentiment as recession fears dominated trading Friday. Analysts warned that an escalating trade war could have severe consequences for the economy.
"If the U.S. doesn’t back down, you could see damaging effects not just in tech but across the entire economy,” said Jay Woods, chief market strategist at Freedom Capital Markets, in emailed remarks to MarketWatch. "This could push us into a recession and end the bull market as we know it.”
By Friday’s close, the S&P 500 had erased more than in the first 75 days of George W. Bush’s presidency, the last time stocks saw comparable declines early in a new administration. The Russell 2000, a small-cap index, posted its worst start to a presidential term on record, according to FactSet data.
The Dow Jones Industrial Average has fallen 11.9% since Inauguration Day, while the S&P 500 dropped 15.4% as of Friday’s close. The Nasdaq, which hit a record high of 20,056.25 on Feb. 19, has since plunged more than 22%, entering bear-market territory alongside the Russell 2000.
Small-cap stocks have been hit particularly hard, with the Russell 2000 down more than 25% since its November peak.
Friday’s losses capped the worst week for U.S. stocks since March 2020, deepening concerns over the market’s trajectory as trade tensions and economic uncertainty persist.
