The U.S. stock market plummets as escalating trade wars spark recession concerns.

On Tuesday afternoon,imf foreign exchange official website the US stock market quickly turned down after a brief rise in early trading. Despite low stock prices and a rebound in market expectations for trade negotiations, optimism was quickly erased after the White House announced it would stick to imposing tariffs, leading to a sharp decline in the stock market.

In Tuesday's trading, the Dow Jones Industrial Average fell 320 points, a decrease of 0.84%. The S&P 500 Index dropped 1.57%, while the tech-heavy Nasdaq Composite Index fell 2.15%. The S&P 500 closed near its lowest level in a year, while the Nasdaq and Dow Jones reached their lowest points since January 2024.

The White House press secretary stated that President Trump would continue with the tariff policy on Wednesday. Previously, the stock market had risen significantly in early trading, with the S&P 500 and Nasdaq indices rising by 4% and 4.5% respectively. However, after this announcement, market sentiment quickly turned negative. The S&P 500 briefly entered a bear market, down more than 20% from its February high. Although it later recovered somewhat, it still closed 18.9% below its peak, close to two consecutive days near bear market territory.

Since last Friday, the Nasdaq Index has been in a bear market, down 24.3% from its record high last December. The Dow Jones Index fell 16.4% from its December high.

Investor sentiment became more tense after several days of market volatility. The Chicago Board Options Exchange's volatility index (VIX) surged, reflecting market uncertainty and fear.

Previously, fears that Trump's high tariffs could push the US and global economies into recession caused significant market volatility in recent days. Investors were seeking buying opportunities, yet Trump's tariff decision served as a reminder that the market rebound may only be temporary. Trust Bank stated that despite significant market volatility, this rebound behavior is a technical response, and while the market is oversold, a rebound might occur in the future.

At the same time, there is anticipation regarding potential progress in trade agreements. The White House's economic council director indicated that the government is handling negotiation requests from several countries, particularly in trade talks with Japan and South Korea. Trump's calls with South Korea's acting president and Japan's prime minister are seen as signals that might ease trade tensions. Despite this, Trump's tariff policies are ongoing, and many countries remain focused on further policy changes.

However, as the trade war continues to escalate, the risk of economic recession increases. Institutions like Goldman Sachs and JPMorgan warn that further deterioration of the trade war could push the US and global economies into recession, suppressing stock market demand. While there is some optimism in the Trump administration, the market remains cautious, and investors are concerned about potential further volatility.

In such a high-risk environment, the ability of the stock market to maintain an upward trend is not guaranteed. As the Trump administration continues with its tariff policies and trade wars between many economies escalate, investors face more complex choices in this situation.

The market carries risks, and investment should be cautious. This article does not constitute personal investment advice and has not taken into account individual users' specific investment goals, financial situations, or needs. Users should consider whether any opinions, viewpoints, or conclusions in this article are suitable for their particular circumstances. Investing based on this is at one's own responsibility.