Stocks fall even as Trump gives Mexico a one-month reprieve from tariffs

Stocks fell Thursday afternoon as President Donald Trump’s pledge to temporarily exempt many Mexican imports from his 25% tariffs failed to deter a wider sell-off.

The S&P 500 was down as much as 2.1%, while the tech-heavy Nasdaq declined 2.8%. The Dow Jones Industrial Average fell approximately 500 points, or 1.4%.

The major averages have each lost more than 3% this week, with the broader S&P 500 having now erased the gains it accrued since Trump won November’s election. That index is off 6% from its all-time high in January, the month he took office.

Thursday’s action marks a reversal of a short-lived rally Wednesday following the Trump administration’s announcement that autos from America’s largest manufacturers would be exempted from the 25% tariffs he unveiled on Canada and Mexico. On Thursday, Trump announced all Mexican goods covered by the United States-Mexico-Canada Trade Agreement, the successor pact to NAFTA that his first administration negotiated, would not face the duties for a month.

That failed to calm a market already primed to be dragged down by a separate development in the artificial intelligence space. Fresh earnings from California-based chipmaker Marvell Technology indicated a possible slowdown in the race among major tech firms to develop advanced AI systems.

Meanwhile, signs of a more significant economic weakening continue to mount. On Thursday, the Challenger, Gray & Christmas consultancy reported that February saw the most job cuts announced in a single month since the early days of the pandemic, as the massive cuts called for by Elon Musk’s DOGE project began to take effect. That data followed findings from private payroll processor ADP Wednesday that showed far fewer jobs added than forecast last month.

Still, the Challenger report also showed steady hiring continued in a number of industries, despite the losses. The Bureau of Labor Statistics is set to report official jobs figures for February on Friday morning. Forecasters expect to see about 170,000 payrolls added, which would be more than the 143,000 job gains in January.