US Market Crashed After 8-12% Historic Rally; Will Dow, Nasdaq, S&P 500 Witness Bearish Trend On April 11?

US Stock Market: Wall Street slipped sharply with Dow Jones, S&P 500 and Nasdaq Composite indexes falling by 2.5% to 4.5% on April 10. This performance comes after the three indices had skyrocketed by 8% to 12% in the previous session. Wall Street continued on its volatile trend as the trade tensions between China and USA continues to be at knives-edge.

Dow Jones ended at 39,593.66 on April 10, down by 2.5%, while Nasdaq Composite index plunged by 4.31% to close at 16,387.31. Furthermore, S&P 500 index slipped by 3.46% to end at 5,268.05.

The performance comes after Dow Jones zoomed by 8% on April 9, while the S&P 500 index shot up by 9.5% and tech-heavy giant Nasdaq outperformed with gains of more than 12.1%.

Investors turned jittery after Trump and China emerged into back-to-back tariffs, neither of them ready to back down. After Trump's 34% reciprocal tariff on China on Liberation Day, the Chinese authority retaliated with its own 34% tariff on American products that will be imported. Which, Trump threatened to impose a 50% additional tariff on Chinese goods, and from April 9, it was reported that China was facing a 104% whopping tariff from the US. The 104% tariff included --- 20% tariff + 34% reciprocal tariff announced on Liberation Day + additional 50% tariff. There were reports of China finally looking to have a dialogue with Trump to ease the tension, however, that hope vanished when China announced a retaliatory 84% tariff as well. And now, Trump has announced a 145% tariff on imported Chinese products. He also announced a 90-day pause on reciprocal tariffs on most of the countries.

Will Bearish Trend Continue On Wall Street?

The US stock futures declined on Friday, hinting at a bearish trend.

As per Trading Economics, U.S. stock futures declined on Friday, capping off a turbulent week dominated by sharp market swings amid ongoing trade uncertainty. On Thursday, major indexes tumbled: the Dow dropped 2.5%, the S&P 500 slid 3.46%, and the Nasdaq Composite sank 4.31%, erasing much of Wednesday's historic rally. That surge had been fueled by President Trump's announcement of a 90-day tariff pause for most countries. However, renewed concerns over escalating trade tensions between the U.S. and China quickly undermined investor confidence. The White House confirmed that total tariffs on Chinese imports have surged to 145%, signalling a deepening trade war between Washington and Beijing.

Looking ahead, investors are eyeing Friday's U.S. consumer sentiment data and quarterly earnings reports from major financial institutions, including JPMorgan Chase, Morgan Stanley, Wells Fargo, and BlackRock, Trading Economics data stated.

As per Dr. VK Vijayakumar, Chief Investment Strategist, Geojit Investments, President Trump's retreat from the reciprocal tariffs imposed on countries except China, was forced by the US bond market where instead of safe-haven buying in US treasuries, there was big selling, pushing the 10-year bond yield up to 4.5%. In brief, bond vigilantes forced Donald Trump to retreat. The 10-year yield is even now at around 4.46%. The dollar index has fallen to 100.

Further, Vijayakumar added, "There is no room for a sustained rally in the market in the present uncertain context. But investors can take relief from the fact that Indian macros are good and we are one of the least impacted countries in this trade war. Investors have to be cautious and should prioritise safety over returns. Safety now is in fairly valued large-caps."