A fresh wave of anxiety swept through global markets on Wednesday, as escalating trade tensions and a surprise warning from Nvidia ignited a sharp sell-off across sectors. The semiconductor giant’s disclosure of a massive export-related charge triggered a rout in chip stocks, dragging broader tech shares into the red and fuelling a global risk-off mood. Remarks from Federal Reserve Chair Jerome Powell added to the unease, as he cautioned that new tariffs could complicate the central bank’s policy goals by pushing inflation higher. Traders now face a volatile mix of policy risk, corporate earnings pressure, and geopolitical headwinds that could define the path forward.

Key Takeaways:

  • Dow Posts Worst Day of 2025, Drops Nearly 700 Points: The Dow Jones Industrial Average plunged 688 points, or 1.73%, to close at 39,669.39. The Dow has now lost nearly 6% since early April, when reciprocal tariffs were first announced.
  • S&P 500 Slides as Tech Sector Craters: The S&P 500 fell 2.24% to 5,275.70, dragged lower by outsized losses in the information technology sector. The index has now declined more than 7% this month, with sentiment deteriorating rapidly.
  • Nasdaq Nears Bear Market on 3% Plunge: The Nasdaq Composite dropped 3.07% to end at 16,307.16, bringing its losses from the peak to nearly 19%. Nvidia’s 6.9% slump and weakness across semiconductors accelerated the decline, while investors braced for further volatility in high-growth names amid ongoing tariff threats and tighter regulation.
  • Europe Mixed as Chip Weakness Clashes with Softer UK Inflation: European equities ended the day mixed, as a tech-led pullback clashed with encouraging signs on inflation. The Stoxx 600 slipped 0.2%, dragged down by a 4.9% drop in ASML after the chipmaker missed net booking forecasts and flagged US trade uncertainty. However, UK stocks outperformed after March inflation came in cooler than expected. Headline CPI eased to 2.6%, below the 2.7% forecast, while core inflation dipped to 3.4% from 3.5%. The data fuelled speculation that the Bank of England could pivot dovish sooner than anticipated. The FTSE 100 rose 0.32% to 8,275.60. Germany’s DAX edged up 0.27% ahead of the ECB’s policy meeting, while France’s CAC 40 was flat and Italy’s FTSE MIB added 0.62%.
  • Asia Falls as Trade War Fears Spread: Asia-Pacific markets closed broadly lower as rising US-China tensions and chip sector weakness pressured risk appetite. Japan’s Nikkei dropped 1.01% and South Korea’s Kospi fell 1.21%, while Hong Kong’s Hang Seng plunged 1.91%. Mainland China’s CSI 300 gained 0.31% after a better-than-expected 5.4% GDP print, though economists warned of downside risks. India’s inflation fell to 3.34%, below forecasts, while Australia’s ASX 200 ended modestly higher. UBS downgraded China’s 2025 GDP outlook, citing tariff drag.
  • Oil Climbs as US Targets Chinese Buyers of Iranian Crude: Oil prices jumped more than $1 a barrel after the US imposed new sanctions targeting Chinese importers of Iranian oil. Brent rose 2.20% to settle at $66.09, while WTI gained 2.38% to $62.80. The move marked an escalation in the US campaign to reduce Iranian exports and comes amid broader US-China trade tension. Crude inventories rose 515,000 barrels last week, roughly in line with estimates. 
  • Treasury Yields Dip as Retail Sales Beat and Tariff Talks Loom: The 10-year Treasury yield ticked down 4 basis points to 4.285%, while the 2-year yield slipped 5 basis points to 3.78%, as investors digested stronger-than-expected March retail sales and fresh tariff headlines. The Commerce Department reported a 1.4% rise in retail sales, beating the 1.2% estimate and up sharply from February’s 0.2% gain. Ex-auto sales climbed 0.5%, also above forecasts. Despite the solid spending data, sentiment remained fragile amid uncertainty over US trade policy. 

FX Today:

  • EUR/USD Surges Toward Recent Highs: EUR/USD rose 1.06% to close at 1.1391, staging a powerful rebound from an intraday low of 1.1278. The pair finished near the high of 1.1411, signalling strong demand as it resumes its broader uptrend. All major moving averages continue to slope higher, with the 50-day SMA at 1.0747, well below current price. The bullish structure remains intact above support at 1.1275, with resistance looming near 1.1500. A breakout above that level could set the stage for a move toward mid-2023 highs.
  • GBP/USD Holds Breakout as Momentum Builds: GBP/USD edged up 0.07% to settle at 1.3241 after trading between 1.3220 and 1.3293. The pair remains firmly above all key SMAs, supported by easing UK inflation data and ongoing bullish momentum. The breakout above 1.3200 earlier this week was technically significant, setting up a potential advance toward 1.3300–1.3350. Support is seen at 1.3150, with deeper backing near the 1.3000 consolidation zone.
  • AUD/USD Extends Breakout Above Key Resistance: AUD/USD advanced for a seventh consecutive session, gaining 0.42% to close at 0.6371. The pair broke above key moving average resistance and is now trading above recent swing highs. The 50-day and 100-day SMAs have flattened, suggesting a potential trend reversal. Immediate resistance lies in the 0.6400–0.6450 zone. Support is now seen at 0.6280 near the breakout point and moving average cluster.
  • USD/JPY Slides as Bearish Trend Accelerates: USD/JPY fell 0.81% to close at 142.08, marking another leg down in a steep decline that began mid-March. The pair remains below its 50, 100, and 200-day SMAs, all trending lower. Tuesday’s close near the session low adds to bearish conviction. Key support sits at 141.50, with further downside risk toward 140.00. A move above 144.00–145.00 would be needed to challenge the downtrend.
  • USD/CHF Hits Multi-Month Lows as Decline Deepens: USD/CHF dropped 1.16% to close at 0.8138, extending its breakdown below key support. The pair has now printed multiple fresh lows and remains well beneath all major SMAs. Momentum favours further downside, with potential targets near the psychological 0.8000 level. Resistance is layered at 0.8200–0.8250, and more significantly at 0.8400. Unless price can reclaim the 50-day SMA at 0.8803, the bearish trend remains dominant.
  • USD/CAD Resumes Slide After Failed Rebound: USD/CAD fell 0.63% to 1.3869 after failing to hold above its 200-day SMA earlier in the week. The pair closed near session lows after a brief recovery attempt was rejected. Resistance now sits at 1.4000 and 1.4100, while key support lies at 1.3800. With all major SMAs sloping lower, the path of least resistance remains to the downside unless the pair can reclaim ground above the 200-day average.
  • Gold Breaks Out to Record Highs with Momentum-Driven Rally: Gold surged 3.35% on Tuesday to settle at $3,337, marking its highest daily close on record. The move came with strong momentum as price pushed to an intraday high of $3,342 before ending just slightly below. The breakout above the key $3,245–$3,250 resistance zone was decisive, supported by sustained bullish sentiment and broad-based demand for safe havens. The metal continues to trade well above all major moving averages, with the 50-day at $2,995, 100-day at $2,838, and 200-day at $2,702, all sharply trending upward. Immediate support now lies at the breakout zone of $3,245, followed by deeper levels at $3,175 and the rising 50-day average.

Market Movers:

  • Nvidia Plunges on $5.5 Billion Export Charge: Shares tumbled 7% after Nvidia disclosed a $5.5 billion charge tied to export restrictions on its H20 chips to China and other countries. The company said US government regulations now require a license to ship the GPUs.
  • ASML Drops After Miss and Trade Warning: ASML shares sank 7% after the chip equipment maker missed expectations on net bookings and warned of demand uncertainty stemming from US tariffs.
  • Interactive Brokers Slides on Earnings Miss: Shares fell 9% after the online trading platform reported Q1 earnings of $1.88 per share, below analyst expectations of $1.92. Revenue came in line at $1.40 billion, and the company announced a four-for-one stock split along with a dividend increase from 25 to 32 cents per share.
  • Omnicom Group Slips After Beating Estimates: Shares declined 7% even as the media firm posted Q1 EPS of $1.70, beating the $1.62 expected. The drop may reflect concerns about broader ad market softness or a sell-the-news response after recent gains.
  • Tesla Drops on Tariff Risk to Cybercab Plans: Tesla shares lost 5% following a report that new US tariffs on Chinese goods could disrupt the company’s production timeline for the Cybercab and Semi truck.
  • Hertz Soars on Pershing Square Stake: Shares of Hertz surged 56% after Bill Ackman’s Pershing Square disclosed a new equity position worth roughly $46.5 million, according to a regulatory filing. The investment reignited interest in the beaten-down rental car stock.
  • Advanced Micro Devices Drops on Export Warning: AMD fell 7% after warning that the latest US export restrictions could result in charges of approximately $800 million. The news came alongside broader weakness in the chip sector following Nvidia’s announcement.

Markets closed sharply lower on Wednesday as investors grappled with a renewed wave of trade-driven uncertainty and unsettling signals from the tech sector. Nvidia’s export-related warning sparked a broad sell-off in semiconductors, while Fed Chair Powell’s remarks on tariffs raised fresh concerns about inflation and policy conflict. Global equity markets reflected the growing unease, with US indices seeing some of their steepest declines of the year. As earnings season unfolds and geopolitical tensions escalate, markets face a volatile road ahead, with traders watching closely for clarity on both policy direction and corporate resilience.