Tariff Day Aftermath: Unpacking the Market Carnage
A look at where major assets—from precious metals to stocks—stand after today’s sharp downturn.
Today was an ugly day in the markets, with losses sweeping across nearly every asset and sector. A staggering $2.5 trillion was wiped out from stocks alone, marking the worst market day since June 2020. While equities have been steadily sliding over the past couple of months—and I warned just days ago that things looked poised to get worse—today’s dramatic selloff was fueled by the Trump administration’s unexpectedly aggressive and far-reaching tariff announcement on Wednesday afternoon. The move has significantly raised fears of a full-blown global trade war.
The S&P 500 sunk 4.89%, the tech-heavy Nasdaq 100 plunged 5.48%, and the Dow Jones Industrial Average (DJIA) tumbled 1,716 points, or 4.04%. Meanwhile, the small-cap Russell 2000 sank 6.57%, making it the first major U.S. index to officially enter a bear market. And it wasn’t just stocks—commodities were hit hard too: gold dropped 1.41%, silver fell 5.99%, oil lost 6.64%, and copper slid 4.21%, just to name a few. Simply put, it was a mass liquidation event—everything but the kitchen sink got dumped.
As you can see from the S&P 500 heatmap below, virtually no stock market sector was spared, with the technology and financial sectors taking the hardest hits:
As I’ve been warning since December, the risk of a recession is now clearly escalating—something we're seeing play out across multiple indicators, including prediction markets like Polymarket and Kalshi, which I’ve averaged and plotted in the chart below:
While I’ve been expecting—and warning—that stocks, still deeply overvalued and clearly in bubble territory, were due for a major bear market, it was disappointing to see gold and silver fall alongside everything else. Still, it’s not entirely unexpected.
Precious metals are liquidity-sensitive assets and often decline during sharp market selloffs, a pattern that goes back as far as I can remember. This happens because investors facing margin calls or needing to raise cash often sell even safe havens like gold and silver to meet those obligations. Some newer investors mistakenly believe gold and silver are perfect inverse hedges to equities, which can lead to unrealistic expectations. But I am not worried at all, as I’ll explain below.