Markets notch worst quarter in years as new tariffs loom

What happened

U.S. stock markets Monday wrapped up their worst quarter since 2022, buffeted by President Donald Trump's tariffs and their expected drag on the economy. The S&P 500 ended the first three months of the year down 4.6%, the Nasdaq sank 10.5% and the Dow Jones Industrial Average shed a more modest 1.3%.

Investors are bracing for more tumult as Trump unveils worldwide "reciprocal" tariffs Wednesday.

Who said what

March's steep losses cap the S&P 500's "worst quarter at the start of a president's term since President Barack Obama took over in 2009 during the financial crisis," The New York Times said. Trump has "acknowledged but dismissed the potential financial hit to consumers and businesses from sweeping tariffs, eroding hopes that shaky markets would cause him to reconsider his actions." He told NBC News on Saturday he "couldn't care less" about rising car prices from auto import taxes set to take effect Thursday.

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Trump has touted his tariffs as a tool to raise revenue, revive domestic manufacturing and exact concessions from other countries. Many economists maintain that Trump's tariffs are unlikely to achieve those aims, and trade experts say his goals "contradict each other," the Times said.

Trump's "ideological fixation on tariffs is crowding out rational judgments about the consequences," including "higher prices" and a "slower economy," The Wall Street Journal said in an editorial. A "tariff is a tax," and "Democrats, who love tax increases, haven't dared pass such a large revenue heist" as Trump is envisioning.

What next?

Trump told reporters he would unveil his closely held "Liberation Day" tariffs Tuesday or Wednesday. The president has been "aggressive with tariff threats," The Associated Press said, but his "on-again, off-again trade actions" suggest "it's possible that we'll see more delays or confusion this week" rather than the clarity markets seek.