Closing Recap

U.S. stocks crumbled, led by a tech sell-off triggered by new chip export restrictions to China, while Fed Chair Powell offered no market support; gold surged to new records, the dollar resumed its sharp decline, Treasury yields eased, and oil gained modestly. 

Key Takeaways 

• Sharp Stock Market Decline: Major indices fell significantly (S&P -2.2%, Nasdaq -3.1%), with selling intensifying throughout the day despite a late mini-bounce. 
• Chip Restrictions Hit Tech: New U.S. restrictions barring NVDA and AMD from selling certain AI chips to China hammered semiconductor stocks (SOX index -4%) and weighed heavily on the tech sector. Weak ASML orders added to semi woes. 
• Powell Offers No Solace: Fed Chair Powell acknowledged slowing growth and tariff uncertainty but indicated no plans for the Fed to intervene in market volatility, disappointing investors hoping for support. 
• Gold Surges to All-Time Highs: Investors flocked to gold amid escalating trade tensions and economic uncertainty, pushing prices up over 3%. 
• Dollar Resumes Plunge: The U.S. dollar fell sharply again, particularly against haven currencies, reflecting shaken confidence in the U.S. outlook. 
• WTO Cuts Trade Forecast: The World Trade Organization drastically lowered its global trade growth forecast for the year, citing tariff impacts. 
• Economic Data Mixed, Ignored: Decent Retail Sales data was overshadowed by trade fears and Powell’s comments; Industrial Production dipped. 
• Rate Cut Expectations Persist: Despite Powell’s cautious tone, futures markets continue to price in multiple Fed rate cuts this year.

Market Overview 

Wall Street endured another brutal session as selling pressure intensified, particularly in the technology sector. The Nasdaq led the declines, falling over 3%, while the S&P 500 shed more than 2%. The primary catalyst for the tech rout was the Trump administration’s imposition of new restrictions barring Nvidia (NVDA) and AMD from exporting specific advanced AI chips (H20, MI308) to China, marking a significant escalation in the U.S.-China tech and trade conflict. Weak quarterly bookings from semiconductor equipment giant ASML further soured sentiment on the chip sector, sending the SOX index tumbling. 

Index	Up/Down	% Change	Last
DJ Industrials	-699.57	-0.0173	39669
S&P 500	-120.89	-0.0224	5275
Nasdaq	-516.01	-0.0307	16307
Russell 2000	-19.44	-0.0103	1863

Markets remained weak heading into a keenly awaited speech by Federal Reserve Chairman Jerome Powell. However, Powell offered little comfort to nervous investors. While acknowledging slowing economic growth partly due to tariff impacts and souring sentiment, he emphasized that markets were functioning “orderly” given the challenges and signaled the Fed would remain patient on policy adjustments, waiting for “greater clarity.” His comments dashed any lingering hopes that the central bank might step in to cushion the market’s “temper tantrum,” reinforcing the view that the Fed is taking a “wait and see” approach this time around. Stocks extended losses following his remarks before a minor bounce into the close. 

The risk-off sentiment was palpable across asset classes. Gold surged over 3% to new record highs as investors sought safety. Treasury yields eased as bond prices rose, and the U.S. dollar resumed its sharp decline against major currencies, reflecting concerns about the U.S. economic outlook under the weight of tariffs. Adding to the gloom, the World Trade Organization sharply downgraded its forecast for global trade growth, citing the negative impact of tariffs. Even decent U.S. Retail Sales data failed to lift spirits, overshadowed by the dominant trade war narrative.

Economic Data

The economic data presented a mixed picture, with solid consumer spending offset by weak industrial activity, but trade concerns and Fed commentary dominated market focus. Strong China data was largely ignored. 

• Retail Sales (Mar): Rose +1.4% m/m, in line with consensus. Excluding autos, sales rose +0.5% (beating +0.3% est.). Excluding autos and gas, sales rose +0.8%. Indicates resilient consumer spending in March. 
• Industrial Production (Mar): Declined -0.3%, slightly worse than the -0.2% consensus drop. Capacity utilization dipped to 77.8% (vs. 78.0% est.). Manufacturing output rose +0.3%, matching consensus. 
• Business Inventories (Feb): Rose +0.2%, matching consensus. The inventory/sales ratio improved slightly to 1.35 months. 
• NAHB Housing Market Index (Apr): Improved to 40 from 39, beating the consensus of 37, suggesting slightly better sentiment among homebuilders, though still low. 
• Atlanta Fed GDPNow (Q1 Forecast): Edged up slightly to -2.2% from -2.4% after recent data releases, but still points to contraction. 
• China Data (Q1/Mar – Reported Earlier): Q1 GDP (+5.4% y/y), March Retail Sales (+5.9% y/y), and March Industrial Output (+7.7% y/y) all beat expectations, showing resilience despite trade headwinds. 

Commodities, Currencies, and Treasuries 

Gold prices soared spectacularly, climbing $106.00 (+3.27%) to settle at a new record high of $3,346.40/oz. The surge was driven by intense safe-haven demand amid escalating trade tensions, economic uncertainty amplified by Powell’s comments, and a sharply falling U.S. dollar. Crude oil prices managed modest gains despite broader market fears, with WTI settling up $1.14 at $62.47/bbl. The market seemed to focus on potential positive signals from China regarding trade talks, outweighing immediate demand concerns fueled by the trade war and a recent EIA demand cut. The U.S. dollar resumed its steep decline, with the DXY falling 1% as haven currencies like the Yen and Swiss Franc rallied strongly against it. The Euro also gained significantly. Treasury yields eased after early volatility, with the 10-year yield settling around 4.27%, supported by safe-haven flows and Powell’s non-committal stance. A 20-year bond auction saw decent demand. Bitcoin prices also jumped amid the risk aversion.

Asset	Up/Down	Unit / % Change	Last
WTI Crude	1.14	USD/bbl	62.47
Brent	1.27	USD/bbl	65.95
Gold	106	USD/oz	3346.4
EUR/USD	0.0117	USD	1.1398
USD/JPY	-1.42	JPY	141.81
10-Year Note	-0.05	%	0.04271

Looking Ahead 

Today marks the final trading day of this holiday-shortened week (U.S. markets closed Friday for Good Friday). Producer Price Index (PPI) data will provide another look at inflation. However, the market’s primary focus will remain squarely on U.S.-China trade relations, particularly any response from China to the new chip restrictions and tariff hikes. Fed Chair Powell’s cautious stance leaves the market feeling exposed, increasing sensitivity to economic data and geopolitical headlines. Earnings season continues, but reports may struggle for attention amidst the broader macro uncertainty. Expect continued elevated volatility.