Waves of volatility shook markets anew, with stocks, bonds and commodities getting whipsawed as traders searched for a bottom in the selloff triggered by Donald Trump’s trade war.

Equities swung between gains and losses, with the S&P 500’s 7% intraday move being the biggest since the bear market of 2020. Such intensity underscores the challenges investors are facing as they navigate a myriad of headlines around tariffs. A $9.5 trillion global wipeout drove the U.S. equity benchmark down almost 20% from its record high. The bond market also experienced wild swings, with 10-year yields climbing 12 basis points after earlier tumbling about as much.

Traders are bracing for another bumpy week amid concerns that a full-fledged trade war will sink the economy into a recession. Equities tumbled at the start of trading and briefly reversed course on speculation Trump was going to delay his tariffs. But the market fell anew again when those hopes waned and Trump threatened to escalate his fight with China.

Wall Street billionaires Bill Ackman and Stanley Druckenmiller slammed Trump’s decision to launch expansive global tariffs, and JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon urged a quick resolution.

“For now, it looks like news out of Washington will continue to drive the market’s swings, one way or the other, said according to Chris Larkin at E*Trade from Morgan Stanley. “Some notable lows over the past few decades have been preceded by similar levels of volatility, although it’s always impossible to know when prices will eventually find their bottom.”

To Matt Maley at Miller Tabak, those looking for a V-shaped recovery in the stock market will likely be very disappointed.

“We should see a strong bounce at some point soon, but the process of repricing the market to its realistic economic outlook will take time,” Maley said. “There will be plenty of time to get aggressive when it becomes more evident that the worst of the decline is behind us.”

HSBC strategist Max Kettner is making the case for a “very short-term bounce” in stock markets, with the Magnificent Seven possibly benefiting the most. However, any rebound will only set the stage for another leg lower, he warns. To Morgan Stanley’s Michael Wilson, investors should be prepared for the S&P 500 to drop further if tariff angst doesn’t subside.

“Many metrics are at panic levels associated with meaningful bottoms over the past 40 years,” said Jonathan Krinsky at BTIG. “The issue is when you get into the capitulation zone, markets often move beyond what many think is likely or possible.”

Hedge funds recorded their largest-ever one-day net sales of global equities on the first day of trading after Trump’s sweeping tariffs announcement, according to Goldman Sachs Group Inc.’s prime brokerage desk. The same division at JPMorgan Chase & Co., which also saw aggressive selling among hedge funds, said declines in positioning would indicate the market is getting close to a tactical bottom.

Meantime, the retail crowd is the last group of investors that has yet to sell U.S. equities, presenting an additional risk to the stock market, according to Goldman’s trading desk.

The slump in equities has taken U.S. equity valuations to the lowest level since late 2023.

At Bespoke Investment Group, the strategists say investors are indeed look for signs of a break in the selling vortex.

“You’ll hear all sorts of opinions as to when and where the market will bottom out, but they’re all guesses, so ignore them,” they noted. “No one knows at this point.”

Larry Tentarelli at the Blue Chip Daily Trend Report, investors should maintain defensive positioning, above average cash levels, and reduced if any new buying until volatility comes down.

“Market direction will be based on the tariff news cycle to start the week,” he said. “If there is a material, positive change in the news cycle, markets could benefit. Until then, continue to expect very wide trading ranges.”

“The swift and sudden stock market decline is a repricing to reflect an impending recession from the burden of tariffs,” said Richard Saperstein at Treasury Partners. “Markets won’t rebound until tariffs are negotiated and reduced, until valuations move even lower to very compelling levels, and until fundamentals improve, and none of these factors are in the cards at this time.”

Wall Street forecasters are racing to temper their views on U.S. equities as Trump’s sweeping tariffs threaten to upend the global economy.

JPMorgan Chase & Co.’s Dubravko Lakos-Bujas slashed his year-end forecast for the S&P 500 to 5,200 from 6,500 previously. Oppenheimer & Co.’s John Stoltzfus — the biggest bull among strategists until March — cut his outlook to 5,950 points from 7,100. Strategists at Evercore ISI, Goldman Sachs Group Inc. and Societe Generale SA have also reduced targets in recent days.

In a note to clients Monday, Stoltzfus said uncertainty was “at levels investors find hard to embrace.” This is being combined with “a negative pitch book that seemingly projects negative outcomes to infinity.”

“Our base case is that after an initial phase in which tariffs could rise further, U.S. effective tariff rates should start to come down from 3Q,” said Solita Marcelli at UBS Global Wealth Management. We also expect the Fed to cut interest rates by 75-100 basis points to support the economy. In this scenario, we believe the S&P 500 can recover to 5,800 by year-end.

Some of the main moves in markets:

Stocks

—The S&P 500 was little changed as of 11:06 a.m. New York time

—The Nasdaq 100 rose 0.5%

—The Dow Jones Industrial Average fell 0.9%

—The Stoxx Europe 600 fell 2.9%

—The MSCI World Index fell 1.3%

Currencies

—The Bloomberg Dollar Spot Index rose 0.4%

—The euro fell 0.3% to $1.0919

—The British pound fell 0.9% to $1.2766

—The Japanese yen fell 0.4% to 147.54 per dollar

Cryptocurrencies

—Bitcoin fell 0.2% to $78,672.2

—Ether fell 0.8% to $1,561.41

Bonds

—The yield on 10-year Treasuries advanced 12 basis points to 4.12%

—Germany’s 10-year yield advanced four basis points to 2.62%

—Britain’s 10-year yield advanced 16 basis points to 4.61%

Commodities

—West Texas Intermediate crude fell 1.4% to $61.11 a barrel

—Spot gold fell 1.3% to $2,997.33 an ounce

(With assistance from Robert Brand, Julien Ponthus, Anand Krishnamoorthy and Richard Henderson.)

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