Dow Jones free fall today: Why is the Dow Jones falling so sharply - Dow, S&P 500 and Nasdaq plunge deep into the red

Market Overview - The Dow Jones Industrial Average fell 689 points, or 1.39%, closing at 48,936.45, raising concerns of a broader market crash [1][24] - The S&P 500 and Nasdaq Composite also declined, with the S&P 500 down 0.67% to 6,863.01 and the Nasdaq down 0.60% to 22,749.39 [1][11] Tariff Impact - A primary driver of the market decline is the announcement of a 15% global tariff increase, which raises import costs and could lead to inflation and squeezed profit margins for multinational companies [3][24] - The Dow is more sensitive to global trade issues compared to tech-heavy indexes, as many of its components rely on international supply chains [5][24] Investor Sentiment - Investors are reacting to uncertainty surrounding the tariffs, with fears of retaliation from Europe and other economies, as well as concerns over whether official tariff documents have been signed [6][7][24] - The Nasdaq's decline indicates a risk-off behavior, with growth and technology stocks typically falling during periods of macro uncertainty [8][24] Commodity Movements - Gold prices surged 2.7% to $5,217.90, reflecting increased inflation fears and geopolitical uncertainty, while silver gained 5.25% [2][9][12] - Oil prices also rose, suggesting that markets are pricing in inflation risk rather than an immediate demand collapse [9][13] Cryptocurrency Trends - Bitcoin fell below $66,000, indicating stress in crypto markets, as it continues to behave like a risk asset during periods of market volatility [10][14][24] Federal Reserve Position - The Federal Reserve is taking a cautious approach to future interest rate decisions, with Governor Christopher Waller indicating that tariff-related inflation may be short-lived [15][24] - The Fed's decisions will be data-dependent, and rate cuts are not expected in March unless economic data deteriorates significantly [21][24] Market Outlook - Investors are questioning whether the current market conditions represent a short-term selloff or the beginning of a deeper correction, with tariff uncertainty being the dominant market driver [19][25] - Upcoming events, including the March 6 jobs report and the Fed's March meeting, will be critical in determining market direction [23][25]