Tech Giants Lose Trillions Fast

Fed Signals No Rate Cuts

April 05, 2025

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TECH
Tech Giants Lose Trillions Fast

Technology megacaps are bearing the brunt of a brutal market selloff, losing a staggering $1.8 trillion in market value over just two trading sessions. The “Magnificent Seven,” once the driving force behind record market highs, are now leading the downturn. Apple suffered the most, shedding over $533 billion in value after tariffs targeted parts of its overseas supply chain, marking its worst single-day drop in five years.

The sharp selloff was triggered by President Trump’s sweeping new tariffs, announced Wednesday, which sparked fears of a global trade war and an impending recession. The tech-heavy Nasdaq endured its worst week since March 2020, with Thursday’s losses alone wiping out over $1 trillion from the top seven tech stocks. Tesla fell more than 10% Friday, losing $139 billion over two days, while Nvidia shed $393 billion. Meta lost $200 billion, and Amazon dropped $265 billion, now on its worst losing streak since 2008.

Even Microsoft and Alphabet, which experienced smaller percentage declines, saw combined losses of over $300 billion. The pain extended beyond megacaps—Oracle dropped nearly 9%, Salesforce fell 11%, while AppLovin and Palantir plunged over 19% and 13%.

Semiconductor stocks, vulnerable due to overseas production, also suffered. The VanEck Semiconductor ETF fell 15% this week. AMD, Intel, Broadcom, and Micron were among the hardest hit, with Micron losing over 25% of its value. Though not yet directly affected by tariffs, fears of future levies and weakening demand have driven the sector’s steep decline.

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FINANCE
Fed Signals No Rate Cuts

Federal Reserve Chair Jerome Powell issued a clear warning Friday that President Trump’s newly announced tariffs are likely to drive inflation higher and slow economic growth, reducing the odds of interest rate cuts in 2024. Speaking at a business journalism conference in Arlington, Virginia, Powell said the impact of the tariffs is becoming more significant than expected. “Higher tariffs will be working their way through our economy and are likely to raise inflation in coming quarters,” he noted.

With the Fed’s benchmark rate still at 4.3%, Powell said there’s no urgency to adjust monetary policy. “We have time,” he said, signaling a cautious approach while the full effects of the tariffs unfold. Despite a strong March jobs report showing 230,000 new jobs and a 4.2% unemployment rate, Powell acknowledged the data preceded Trump’s “Liberation Day” tariffs.

Economists have since downgraded their outlooks. JPMorgan now sees a 60% chance of recession in 2024, calling the tariffs “the largest U.S. tax hike since 1968.”

Throughout his remarks, Powell emphasized the Fed’s independence, stating it’s guided by data, not politics. Meanwhile, Trump publicly pressured Powell to cut rates, calling it “a PERFECT time” and accusing him of “playing politics.”

DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.