Dow falls 1,000 points as tariff sell-off resumes after historic rally: Live updates

Stocks fell Thursday, giving back some of the historic rally seen in the previous session after President Donald Trump announced a 90-day reprieve on some of his “reciprocal” tariffs. Investors worried that even with the short reprieve on some of the duties, economic activity will be slowed by Trump’s singling out of China with higher rates.

The Dow Jones Industrial Average dropped 1,077 points, or 2.7%. The S&P 500 shed 3.2%, while the Nasdaq Composite slid 3.8%.

Leading the declines were Apple and Tesla, which pulled back more than 2% and 5%, respectively. Nvidia lost 3.6%, while Meta Platforms slipped 3.8%.

The White House confirmed to CNBC on Thursday that the cumulative tariff rate on China would actually total 145%. This consists of the new 125% duty on goods, on top of the 20% rate levied in response to the fentanyl crisis.

The moves come after a historic surge on the Street, where the S&P 500 soared more than 9% for its third-largest gain in a single day since World War II. The Dow also saw its biggest percentage advance since March 2020, while the Nasdaq scored its biggest one-day gain since January 2001 and second-best day on record.

The rally took off after Trump announced a temporary drop in tariff rates for most countries to 10% for 90 days. Canada and Mexico won’t be subjected to an additional 10% duty, however. The European Union announced Thursday a similar 90-day pause on U.S. goods.

“I thought that people were jumping a little bit out of line,” Trump said. “They were getting yippy, you know, they were getting a little bit yippy, a little bit afraid.”

Despite optimism in response to the 90-day reprieve, some on the Street think the market is not yet out of the woods. Even with the delay in some tariffs, hike on China duties puts the effective tariff rate at a historic high, according to Morgan Stanley.

“Delays help, but do not reduce uncertainty,” Michael Gapen, Morgan Stanley chief U.S. economist, wrote in a Thursday note.

Others were echoing a similar sentiment following the market surge.

“I think the upside case for sticks is impaired,” Fundstrat head of research Tom Lee told CNBC’s “Squawk on the Street” on Thursday. ” “The Fed has made clear during the midst of this that ‘the Fed put’ really isn’t in play until they have a better idea of inflation. … Markets then have to depend on fundamentals and a policy path — the White House — that they’re they can’t necessarily depend on.”

The major averages are also still down sharply since the tariffs were announced on April 2. The S&P 500 is lower by more than 6% in that time.