It’s been one hundred days since Donald Trump returned to the White House. And nearly every one of those days has seen disruption in one form or another. The biggest loser in this period, according to economic data revealed yesterday, is the U.S. economy. Today we investigate how the Dow Jones is reacting to the U.S. economy shrinking.
In today’s story in Bloomberg about Trump’s term so far, the leading newswire highlighted how Trump previously “bragged” about how well U.S. stocks performed during his first presidency. Trump’s second administration has begun with the worst performance of any recent presidency.
However, today Trump has come out and defended his record. Speaking at the White House this afternoon, he told reporters that the stock markets had grown by as much as 88 percent during his last administration. How he believed that in the next three and half years there will also be growth.
He was reponding to what the U.S. Department of Commerce wrote on Wednesday. It shared that the U.S. economy shrank by 0.3 percent in the first quarter of 2025. Not long after the news, Trump responded by shifting the blame onto Biden’s presidency. Later, during his interaction with reporters, he explained that his administration started on January 20th. It hadn’t even been a full quarter. It was likely that the second quarter would also reflect more on Biden’s administration, he emphasized.
How Did the Dow Jones React to News?
The main news from the U.S. Department of Commerce today was a visit by Commerce Secretary Howard Lutnick at TSMC’s Arizona site. The chip manufacturer is reported to be investing $168 billion into Arizona. But news about U.S. economy figures had already hit the markets, and the good news made little impact. The Dow Jones Industrial Average (DJIA) dropped below 40,000 in a dramatic downturn after markets opened, losing more than 700 points from highs of over 40,500 yesterday.
This afternoon U.S. markets have recovered, and the DJIA is making up ground on earlier losses. But there is a long way to go to return to highs of 42,200 from April the 2nd. The significance of this date is how Liberation Day jolted markets globally on that day. This day was not in the first quarter that was reported to have been the period during which the U.S. economy shrank. Trump’s tariffs have meant that the DJIA remains almost 10 percent lower than the highs of late 2024 when the DJIA briefly reached 45,000 in December.
Microsoft, reporting earnings today, is among the DJIA stocks that underperformed, losing nearly 1 percent. Other underperformers include Amazon, Nike, and Chevron. The share prices of all three companies fell by more than 2.5 percent today.
One company that had a better day was Verizon, which saw a rise in share price of 2.4 percent.
Elsewhere, TSMC shares on NYSE have seen a robust increase in price today going up over one percent.
Will the Dow Jones Recover to 2024 Highs?
Another consideration is the latest results from the Personal Consumption Expenditures Price Index or PCE. In March the Bureau of Economic Analysis showed how March had dropped to 2.3 percent from February’s 2.7 percent. The trend had been one of growth over the previous few months, so this drop is significant. It shows that inflation is less of a concern. It may lead to the Federal Reserve reconsidering interest rates, which will be announced on May the 7th. If interest rates are lowered the DJIA may respond positively.
However, the ongoing disagreement between Trump and the Fed’s Jerome Powell has been well reported. If Trump is looking for lower interest rates, which the PCE data suggests might be possible, then the pressure will be on Powell to act to implement this. If he doesn’t there may be more fireworks between the White House and the Fed, and a bit more uncertainty for markets too.
Author: Andy Samu
#DowJones #Trump #Economy #DJIA
Data comes from leading trading platform TradingView.
See Also:
How Did the Dow Jones React to the Market Crash? | Disruption Banking
Will Trump’s Liberation Day Cause a Stock Market Crash? | Disruption Banking
