Stocks fell Thursday afternoon as President Donald Trump’s temporary exemption of many Mexican imports from his 25% tariffs failed to prevent a broader market sell-off.
The S&P 500 dropped as much as 2.1%, while the Nasdaq fell 2.8%. The Dow Jones Industrial Average lost about 500 points, or 1.4%.
All three major indexes have now dropped more than 3% this week, with the S&P 500 erasing the gains it had made since Trump’s election in November. The index is down 6% from its all-time high in January, the month Trump took office.
Thursday’s decline reversed a brief rally on Wednesday following the Trump administration’s announcement that autos from major U.S. manufacturers would be exempt from the 25% tariffs on Canada and Mexico. On Thursday, Trump also revealed that all Mexican goods covered by the United States-Mexico-Canada Trade Agreement (USMCA) would be exempt from the tariffs for a month. However, this move failed to soothe markets already under pressure from concerns about a slowdown in the artificial intelligence sector. Earnings from California-based chipmaker Marvell Technology raised worries about a possible deceleration in the race to develop advanced AI systems among major tech firms.
At the same time, signs of economic weakening continue to mount. On Thursday, consulting firm Challenger, Gray & Christmas reported that February saw the highest number of job cuts in a single month since the early days of the pandemic, largely driven by the workforce reductions tied to Elon Musk’s DOGE project. This followed Wednesday’s data from ADP, which showed that job growth was much slower than expected last month.
Despite the losses, the Challenger report indicated that hiring remained steady in several sectors. The Bureau of Labor Statistics will release official February job figures on Friday morning, with economists expecting a gain of about 170,000 jobs, slightly more than the 143,000 added in January.
