S&P 500 Forecast: Apple, Tesla Drop as Fed Risk and Trade Fears Shake US Indices

Dow Sinks 700 Points as Trade Tensions and Fed Pressure Weigh on Wall Street

Stocks dropped sharply Monday, extending recent losses as concerns around stalled trade negotiations and political pressure on the Federal Reserve weighed on investor sentiment. The Dow Jones Industrial Average fell, while the S&P 500 slid. The Nasdaq Composite lost, dragged down by weakness in tech and consumer names.

At 14:07 GMT, the S&P 500 Index is trading 5183.37, down 99.13 or -1.88%. The Nasdaq is at 15887.84, down 398.61 or -2.45% and the Dow Jones Industrial Average is trading 38482.77, down 659.46 or 1.68%.

Are Trade Talks and Tariffs Driving the Sell-Off?

The absence of progress on global trade talks over the weekend rattled markets. China issued fresh warnings against deals it perceives as detrimental, escalating friction with the U.S. Since President Trump’s tariff announcement in early April, the major indexes have fallen about 7%, with investors pricing in prolonged uncertainty. Last week, the S&P 500 declined 1.5%, while the Dow and Nasdaq each fell over 2%, marking the third weekly drop in the past four weeks.

How Is the Fed’s Independence Becoming a Market Risk?

Markets were also unsettled by growing political pressure on the Federal Reserve. Chicago Fed President Austan Goolsbee warned Sunday that tariffs could dent U.S. growth by summer. Fed Chair Jerome Powell expressed similar concerns last week, citing inflation risks tied to tariffs.

Trump’s recent suggestion that Powell could be removed, coupled with the White House’s reported inquiry into that possibility, further stoked uncertainty. Traders are increasingly concerned that the Fed may be constrained in its ability to respond to weakening growth.

Which Stocks and Sectors Are Leading the Declines?

Tech stocks were hit hardest, with the sector falling 2.1%. Tesla sank 5% after Barclays cut its price target, citing unclear earnings visibility. Nvidia dropped nearly 4%, while AMD fell 2.8%. Amazon slipped nearly 3% following a downgrade by Raymond James.

Apple dropped 2% and is down over 11% in April. Alphabet lost more than 2% after a judge ruled the company holds an illegal advertising monopoly. Semiconductor names like Marvell, Broadcom, and Lam Research all posted losses exceeding 2%.

Gold stocks gained on a sharp rally in precious metals. Newmont rose more than 3%, tracking a 2.4% gain in gold futures, which broke above $3,400 per ounce as the dollar index slid more than 1%. Netflix climbed 2% after reporting stronger-than-expected earnings last Thursday, with several analysts raising price targets.

What Should Traders Watch Next?

Volatility is likely to remain elevated as trade uncertainty and Fed policy tensions cloud the outlook. Upcoming earnings from Alphabet, Microsoft, and Meta will test the tech sector’s resilience, while Apple and Amazon remain in focus due to tariff exposure.

Traders will also monitor any updates from Washington on both trade and the Fed’s leadership. Until these risks are clarified, downside pressure may persist across risk assets.

More Information in our Economic Calendar.