Fears of a 2025 Recession Are Gaining Steam

Wall Street started the new trading week in a foul mood on Monday, with the Dow tumbling about 500 points and the benchmark S&P 500 index down more than 2%. It's a continuation of last week's selloff blamed on tariff uncertainty, but Monday's pain appears to have been worsened over the weekend by President Trump's comments about a possible recession. In short, he declined to rule out the possibility in 2025, though his own commerce secretary disagreed. Related coverage:

• Bankers' pessimism: The Wall Street Journal reports that big banks are growing more worried about a recession. JPMorgan Chase says the chances are now 40%, up from 30% at the year's start. Goldman Sachs also raised the risk (from 15% to 20%), as did Morgan Stanley, which also revised downward its economic growth forecasts for 2025 and 2026.

• China's move: The market's wobbling comes as China's retaliatory tariffs on a slew of American farm products took effect on Monday, reports the New York Times. Chicken, wheat, and corn were among the products affected. It's another escalation of the trade fight between the US and Beijing, with China accusing Trump of disrupting "the security and stability of the global industrial and supply chains" through his tariffs.
• Tesla, other giants: The companies seen as the "Magnificent Seven" on Wall Street were having less-than-magnificent Mondays, notes CNBC. Leading the losses were Tesla (down 8%), Nvidia (5%), Meta (5%), and Alphabet (4%). In fact, the tech-focused Nasdaq index was down more than 3% in early trading. One big fear is that a trade war will drive up prices, making it less likely the Federal Reserve will cut interest rates.
• Effect on Musk: Tesla's decline has hit the fortunes of Elon Musk, whose net worth is down $121 billion from its high of $464 billion in December, according to Forbes. His remaining $343 billion, however, still makes him the world's richest person.

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