Wall Street drops after previous day’s reprieve rally; dollar down

Major stock indexes fell on Thursday, with the Nasdaq down more than 3% in early trading, after the previous session’s massive relief rally on US President Donald Trump’s move to temporarily lower the heavy tariffs on many countries, while the U.S. dollar also sank.

US Treasury prices moved higher after this week’s sharp bond selloff.

The stock declines came despite US data showing consumer prices unexpectedly fell in March.

“All things being equal, if tariffs are paused and inflation is going lower, it’s green light go if you’re an investor,” said Jake Dollarhide, chief executive officer of Longbow Asset Management in Tulsa, Oklahoma.

Amid the head-spinning changes in the market and news on tariffs, investors also are gearing up for the start of quarterly US earnings, with results from some of the biggest US banks including JPMorgan Chase due on Friday.

The Dow Jones Industrial Average fell 915.22 points, or 2.30%, to 39,693.23, the S&P 500 fell 153.61 points, or 2.81%, to 5,303.29 and the Nasdaq Composite fell 592.43 points, or 3.46%, to 16,532.54.

MSCI’s gauge of stocks across the globe fell 2.71 points, or 0.35%, to 782.57, while the pan-European STOXX 600 index rose 4.32%.

Trump’s reversal on tariffs on Wednesday pushed equities higher across the globe, starting with a 9.5% pop in the S&P 500 on Wednesday.

Stocks in Asia also rallied from Trump’s announcement on tariffs, including in China, even though Trump on Wednesday also said he would raise the tariff on Chinese imports to 125%.

China’s CSI300 blue-chip index rose 1.3%, while Hong Kong’s Hang Seng Index advanced 2.1%.

Other tariffs also still stand. A 10% blanket duty on almost all U.S. imports will remain in effect.

Business