Summary of the Article

On Monday, the S&P 500 dropped 4% shortly after trading began, officially entering bear market territory. Although it recovered some losses later, the day could mark a historic low if the S&P 500 ends with a third consecutive 4% drop—a feat not seen since the 1929 stock market crash that triggered the Great Depression.

The market turmoil follows President Donald Trump’s announcement of sweeping tariffs on nearly all U.S. trade partners, which caused the worst week for stocks since the peak of the COVID-19 pandemic. Overseas markets also suffered, with Hong Kong experiencing its worst day since the 1997 Asian financial crisis.

Trump defended his trade policies, claiming they would bring systemic change, but prominent investor Bill Ackman warned that the trade war could lead to a self-inflicted economic disaster. Ackman urged Trump to pause the tariffs and negotiate fair trade deals to avoid what he described as an “economic nuclear winter.”

A short time after trade began on Monday, the S&P 500 dropped 4%, officially entering bear market territory. It later got back some of the money it had lost. Monday could be a really historic day in the stock market, and not in a good way, if it ends the same way it began.

In the event that the S&P fell more than 4% on Monday, it would be the third day in a row that it fell more than 4%. And it would be the first time in almost a hundred years, since the stock market crash of 1929 that started the Great Depression, that the S&P 500 fell three times in a row by more than 4%.

This past week, President Donald Trump announced broad tariffs on almost all of America’s trade partners. This caused stocks to have their worst week since the peak of the coronavirus pandemic. Thursday and Friday were the worst days for stocks in the past five years.

Monday, the bleeding kept going. After losing 4%, the S&P 500 joined the tech-heavy Nasdaq Composite in a bear market (a drop of 20% or more from a recent high point). It was down 2.3% as of 10 a.m. It went down 1.6% on the Nasdaq and 2.7% on the Dow Jones Industrial Average Futures.

Overseas stocks fell sharply. Hong Kong’s main market index fell 13%, making it the worst day for the market since Asia’s financial crisis in 1997. There were also big drops in stocks in Europe.

Trump has been very stubborn in response to the long market drop. Late Sunday night, he said again that his trade policies will bring about the needed systemic change in the U.S. economy.

The president told reporters on Air Force One on his way back to Washington from a weekend in Florida, “I can’t tell you what’s going to happen to the markets.” “I don’t want anything bad to happen.” But sometimes you need to take medicine to feel better.

Bill Ackman told Trump on Sunday that the trade war could crash the economy if it wasn’t stopped.

Bill Ackman, the wealthy CEO of Pershing Square Capital Management, wrote in a long post on X Sunday, “The country is 100% behind the president on fixing a global system of tariffs that has hurt the country.” “But business is based on trust, and trust is built on confidence.”

We are destroying trust in our country as a trading partner, a place to do business, and a market to invest capital,” Ackman continued. We are launching a global economic war against the whole world at once by putting huge and unfair tariffs on our friends and our enemies alike.” “The president has the chance to declare a 90-day “time out,” negotiate and settle unfair asymmetric tariff deals, and bring in trillions of dollars in new investment.

“On the other hand, we are heading for an economic nuclear winter that we are creating ourselves, so we should start hiding out,” he said. “May cooler heads win out.”

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