It was a rough Wednesday for the stock market, as the S&P 500 took a 0.8% hit. Tech stocks really stumbled, and traders were left scratching their heads again about potential trade tariffs.

The Dow Jones Industrial Average also felt the pressure, dipping 42 points, or about 0.1%. But the tech-heavy Nasdaq Composite got it the worst, sliding almost 1.7%. This market reaction came as investors tried to decipher mixed messages from President Trump about tariffs, while also bracing for possible new taxes on imported cars.

Word on the street, according to Bloomberg News, is that President Trump might drop a public announcement about those auto tariffs as early as Wednesday. This report, citing sources in the know, came ahead of his previously mentioned April 2nd date for potential reciprocal tariffs.

Just the day before, on Tuesday, Trump seemed to soften his stance, suggesting tariffs might be “more lenient than reciprocal,” which briefly gave the markets a little lift.

Tariff confusion slams tech while traders ditch growth stocks

But traders weren’t waiting around to see the President’s next move. Wednesday saw some significant drops: Nvidia shares tumbled over 5.5%, Tesla lost about 5%, and big names like Alphabet, Amazon, and Meta each fell by more than 1%. This downward pressure pulled the S&P 500 down, wiping out the gains from earlier in the week. Before this dip, the S&P 500 had actually climbed 1% since Monday, and the Nasdaq had matched that gain. The Dow was showing a decent 1.3% increase for the week so far.

This decline followed a boost of confidence on Tuesday when reports hinted that tariffs might be delayed and less extensive. However, that optimism quickly faded. Investors were also digesting a consumer confidence report from the Conference Board, which revealed that Americans are feeling more pessimistic about their income, job prospects, and the overall business climate than they have in over a decade.

Mark Hackett, the chief market strategist at Nationwide, noted that the S&P 500 had managed to recover nearly half of its losses from the previous month.

“The market’s mood is calming down after a pretty bumpy ride… the technical indicators that tanked during the recent market correction are starting to show signs of recovery,” Mark explained.

But that calmness proved to be short-lived.

Barclays isn’t convinced the market’s heading in a positive direction just yet. On Wednesday, the bank lowered its 2025 forecast for the S&P 500 from 6,600 to 5,900. They pointed to the real possibility of an economic slowdown if these tariffs actually happen. This new target means the S&P 500 now has only a slim 0.3% potential upside from the start of the year. It’s also the most pessimistic prediction in CNBC Pro’s survey of market experts.

Venu Krishna, a strategist at Barclays, explained, “Our previous outlook didn’t factor in a direct hit from tariffs. But now, we have to consider it. And honestly, for the near future, it would be unwise not to take this seriously. These tariff issues aren’t going to be resolved quickly in the next 6 months… and that’s the worry.”

Wall Street firms shift ratings as GameStop dives into crypto

While the traditional stock market stumbled, crypto-related stocks went in the opposite direction. GameStop shares surged over 16.5% in premarket trading after they announced plans to invest some of their company cash into Bitcoin and stablecoins pegged to the U.S. dollar.

This decision was made during a board meeting on Tuesday, where executives unanimously gave it the green light. The company also mentioned they might invest future funds from debt and equity into crypto as well.

GameStop’s move mirrors the strategy of MicroStrategy, now known as just Strategy, which has become the biggest public holder of Bitcoin by pouring billions into the cryptocurrency over the last few years. GameStop seems to be following a similar path as they try to reinvent themselves on Wall Street.

Elsewhere, analysts were busy updating their ratings on major companies. Goldman Sachs reaffirmed its “buy” rating on Disney, calling it “a high-quality company with strong earnings growth at a reasonable price.” Goldman is confident about Disney’s stock, especially with the ongoing recovery in their theme parks and media businesses.

Citi bumped up TotalEnergies from “neutral” to “buy,” anticipating that the company will benefit from decreasing risk premiums in European equities.

“We believe European Energy stocks, particularly TTE, are key beneficiaries of a lower risk premium in Europe. TTE is quickly becoming the top-tier energy stock to hold as a standard part of a portfolio,” the firm stated in their analysis.

Morgan Stanley maintained their “overweight” rating on Dell, even after a meeting with the company’s COO and CFO. They believe Dell is still set to be a leader in key areas like AI infrastructure, data storage, and PCs.

“After diving into key investor questions with DELL’s COO and CFO, we remain just as convinced that DELL can extend its leadership in AI systems, while also regaining momentum in storage and PCs, and managing costs to exceed revenue and earnings growth expectations,” analysts wrote.

Crypto also received more positive news from Rosenblatt, who recommended investors “buy the dip” in Coinbase. The firm expects stablecoin regulations to arrive in Q3 2025 and believes investors are underestimating Coinbase’s revenue from sources other than trading fees.

“With stablecoin legislation increasingly likely in Q3 2025, we believe investors are overlooking the potential of COIN’s non-trading revenue streams in the current political climate. We expect the stock’s value to rise as investors become more comfortable with COIN’s diverse business model,” the firm explained. They added that any weakness due to low trading volumes should be seen as an opportunity to buy more.

In healthcare news, Morgan Stanley also initiated coverage on Tenet Healthcare, giving it an “overweight” rating. They believe Tenet is “well-positioned to profit from the ongoing shift towards outpatient care and lower healthcare costs” as healthcare providers continue to move away from traditional hospital-based models.

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Source: cryptopolitan.com