US stock markets experienced a steep decline on Monday as investors expressed concerns regarding the economic repercussions of President Donald Trump’s tariffs. The S&P 500 fell by 2.7%, the Dow Jones dropped 2%, and the Nasdaq decreased by 4%, with significant losses among major tech companies like Tesla, Nvidia, and Amazon. Trump's recent remarks about the US undergoing a “period of transition” heightened worries over economic uncertainty, leading government officials to attempt to calm investors.

In Asia, stocks initially declined on Tuesday but eventually bounced back, with Japan’s Nikkei 225 closing down by 0.6% and South Korea’s Kospi down by 1.3%. Analysts indicate that anxiety over a possible trade war and decelerating economic growth are fueling market fluctuations. While some experts caution about recession risks, Trump’s advisers contend that the tariffs are bolstering the economy by bringing jobs and investments back to the US.

Economists note that investors are recalibrating their expectations after initially anticipating tax cuts and deregulation under Trump. With both businesses and consumers displaying signs of caution, market analysts remain split on whether these anxieties will result in a long-term economic downturn or recovery.