Trump Blames Biden for Market Downturn Amid GDP and Tariff Turmoil
U.S. stock markets wrapped up on a mixed note on Wednesday, marking the end of a tumultuous April marked by economic decline and trade policy uncertainties.
The S&P 500 saw a rise of 0.15%, whereas the Nasdaq Composite experienced a slight decline of 0.086%. The Dow Jones Industrial Average gained 141 points in response to new data revealing that the U.S. economy contracted for the first time since 2022.
According to the Commerce Department, the first-quarter GDP decreased at an annualized rate of 0.3%, reversing a prior gain of 2.4% from the previous quarter.
This contraction was partly attributed to a 41% increase in imports, as businesses prepared for new tariffs announced by President Trump.
Additionally, consumer spending slowed to its lowest rate in over a year, while reduced government expenditures further exacerbated the decline in economic growth.
Uncertainty Over Tariffs
Earlier this month, markets had shown signs of recovery after Trump postponed certain tariffs and hinted at potential trade agreements with countries like India. However, renewed volatility ensued as investors digested discouraging economic data, inflation concerns, and ongoing ambiguity in trade negotiations.
The losses incurred in April followed a sharp drop after Trump announced “reciprocal” tariffs on April 2, leading to a peak decline of over 11% in the S&P 500.
On Truth Social, Trump attempted to shift the blame for the economic downturn, asserting, “This is Biden’s Stock Market, not Trump’s,” and attributing the disappointing figures to a “Biden Overhang.” He urged patience, claiming that his policies would ultimately yield positive results.
During Trump’s second term, the stock market has recorded one of the weakest performances for any president’s first 100 days in recent memory.
Analysts point to ongoing policy uncertainty as a critical factor. “This is clearly driven by the uncertainty surrounding the tariffs,” stated Kelly Bouchillon of Sound View Wealth Advisors.
Meanwhile, major companies such as First Solar and GE HealthCare have revised their forecasts downward due to challenges linked to tariffs. Nvidia shares also took a hit following disappointing results from Super Micro Computer.
