US stocks drop as investors await Trump’s vehicle tariffs

New York — Wall Street stocks ended sharply lower on Wednesday, dragged down by losses in Nvidia and Tesla as investors awaited information about long-promised US tariffs on automotive imports.

US President Donald Trump was set to announce plans for car-industry tariffs at a press conference on Wednesday, widening the global trade war he kicked off this year. Auto industry experts expect the move to drive up prices and stymie production. For weeks, Trump has promised to announce a swath of reciprocal tariffs on April 2.

Shares of Tesla dropped 5.6% and General Motors lost 3.1%, with investors uncertain about the scale of tariffs, retaliatory measures from trading partners and potential ripple effects on the global economy and businesses.

“Markets hate the tariff uncertainty, especially when it pertains to autos. Autos are ground zero for the negative economic impacts of tariffs,” said Jamie Cox, managing partner at Harris Financial Group.

Heavyweight chipmakers Nvidia slid almost 6% and Broadcom fell almost 5%, pushing the PHLX chip index down 3.3%.

The S&P 500 declined 1.12% to end the session at 5,712.20 points. The Nasdaq declined 2.04% to 17,899.02 points, while the Dow Jones industrial average declined 0.31% to 42,454.79 points.

Of the 11 S&P 500 sector indexes, six declined, led lower by information technology, down 2.46%, followed by a 2.04% loss in communication services.

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 US manufactured goods.

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 later this week will be the personal consumption expenditures price index — the Federal Reserve’s favoured 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 3.1% after the discount-retail chain said it was nearing a sale of its Family Dollar business to a consortium of private equity investors for about $1bn.

GameStop jumped nearly 12% following its board’s unanimous approval to incorporate bitcoin as a treasury reserve asset.

Reuters