U.S. stock markets opened sharply lower on Monday, marking a return from the previous week’s shortened trading period. Investors reacted negatively as President Trump intensified his critiques on Federal Reserve Chair Jerome Powell, labeling him as a “major loser.”

The S&P 500 index saw a decrease of 152 points, equivalent to 2.9%, settling at 5,130 early in the trading session. Similarly, the Dow Jones Industrial Average fell by 1,071 points, or 2.7%, while the technology-focused Nasdaq Composite experienced an even steeper drop of 3.2%.

Factors Contributing to Market Decline

Investor sentiment was stressed by ongoing uncertainties surrounding tariffs, as well as the eagerly awaited earnings reports from various technology firms this week. Global market activity was subdued, with many international exchanges, including those in Europe, Hong Kong, and Australia, closed for Easter Monday.

Pressure Mounts on Federal Reserve Leadership

The tumultuous opening on Wall Street followed a volatile preceding week characterized by concerns over the economic implications of Trump’s tariff policies and the future direction of the Federal Reserve. Tim Duy, chief economist at SGH Macro Advisors, noted that “the tariffs on China are leading to a standstill in some trade activity,” highlighting the ongoing impact of these policies.

Last Wednesday, Powell emphasized that tariffs could contribute to rising U.S. inflation and hinder growth, causing further market reactions. Trump’s criticisms have raised concerns among investors regarding the potential for an unprecedented change in Fed leadership. He suggested on Truth Social that the economy could falter “unless Mr. Too Late, a major loser, lowers interest rates, NOW.”

While legal experts, including Powell himself, contend that Trump lacks the authority to dismiss the Fed chair, the president’s public comments exacerbate worries about unconventional interventions at the central bank.

Adam Crisafulli, head of Vital Knowledge, warned that “the battle between the Fed and White House could get a lot worse in the coming months,” noting that Powell’s term is set to last until May 15, 2026, despite Trump’s increasing pressure to adjust interest rates.

Austan Goolsbee, president of the Chicago Federal Reserve, expressed hope that the independence of the central bank remains intact, stating, “I strongly hope that we do not move ourselves into an environment where monetary independence is questioned,” underlining the importance of maintaining the Fed’s credibility.

Focus on Technology Earnings

As this week progresses, attention will shift to the earnings reports of major technology companies, collectively referred to as the “Magnificent Seven,” which includes Amazon, Alphabet (Google), Apple, Meta Platforms (Facebook), Microsoft, Nvidia, and Tesla. These firms have faced significant stock volatility in recent weeks due to conflicting tariff announcements.

Since President Trump’s inauguration on January 20, the combined market capitalization of these companies has declined by approximately $3.8 trillion, or 22%, as of April 20, indicating substantial fluctuations in the sector.