Tech Stocks Plunge as Tesla Drops Over 6% on Potential Auto Tariffs

Tesla experienced a significant drop of over 6% on Wednesday following an announcement regarding potential auto tariffs. This news also triggered a sell-off in tech stocks, impacting the overall market sentiment. The S&P 500 is now at risk of ending a three-day winning streak due to these developments.

Impact of Auto Tariff Announcement

On Wednesday, the White House disclosed that President Donald Trump would reveal details about auto tariffs at 4:00 p.m. ET. Despite the lack of specific information prior to the announcement, investors swiftly responded to the news. Tesla shares plummeted by more than 6% as a result, with other car manufacturers and tech stocks also experiencing a negative impact.

Regulatory Concerns for Nvidia

Furthermore, Nvidia, a prominent player in the artificial intelligence sector, faced a 6% decline amid reports suggesting potential regulatory challenges in China. This market accounts for 13% of Nvidia's annual sales. Beijing's decision to tighten chip energy standards, particularly excluding Nvidia's top-selling processor, added to the downward pressure on the company's stock.

Market Response and Index Performance

The sell-off in Tesla and Nvidia shares contributed to the S&P 500 heading towards the end of a three-day upward trend. Recent market optimism stemming from a relaxation of Trump's tariff policies was overshadowed by the uncertainty introduced by the auto tariff announcement.

Consequently, major indices such as the S&P 500 and the Nasdaq Composite experienced declines of 1.12% and 1.99%, respectively. The Dow Jones Industrial Complex also saw a drop of 146 points, reflecting the broader negative sentiment in the market.

Performance of Top Tech Stocks

As of 2:45 p.m. ET, several key tech companies witnessed significant declines in their stock prices:

• Nvidia: -6.5%
• Tesla: -6%
• Meta: -3%
• Alphabet: -3%
• Amazon: -2.6%
• Microsoft: -1.5%
• Apple: -1%

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By: fdemott@businessinsider.com (Filip De Mott)
Title: Tech Stocks Plunge as Tesla Drops Over 6% on Potential Auto Tariffs
Sourced From: www.businessinsider.com/tesla-stock-price-trump-auto-tariffs-trade-war-tech-stocks-2025-3
Published Date: Wed, 26 Mar 2025 18:59:53 +0000