The U.S. stock market experienced a major crash in early April 2025, triggered by President Donald Trump's announcement of widespread tariffs on nearly all imported goods, excluding a few exceptions like pharmaceuticals and semiconductors. This policy, known as "Liberation Day," involved a 10% tariff on all imports, with even higher tariffs on key trading partners such as China (34%) and the European Union (20%). The announcement caused a sharp sell-off, with the Dow Jones Industrial Average dropping over 1,344 points (3.22%) and the S&P 500 falling 176.96 points (3.15%) immediately after the tariffs took effect on April 9, 2025
. This crash was the largest decline since the COVID-19 pandemic, wiping out more than $3 trillion in market value shortly after the tariffs were announced
. The S&P 500 fell about 12% within four days, and the Dow lost nearly 4,600 points, or about 11%
. However, the market rebounded quickly in the following weeks. By early May, the S&P 500 had recovered all its losses and was on a nine-day winning streak, although it remained about 7% below its record high from earlier in the year
. More recently, on May 5, 2025, the market showed slight declines with the S&P 500 falling 0.6% and the Dow slipping about 0.2% (roughly 99 points), despite some better-than-expected economic data
. Overall, the market remains volatile due to ongoing uncertainties about the long-term economic impact of the tariffs and trade policies
. In summary, the stock market crash in 2025 was primarily caused by tariff- related trade tensions, leading to a sharp but relatively short-lived decline followed by a notable recovery in the weeks after the initial shock
