Trump blames Biden as markets weaken on GDP and tariff turmoil

U.S. stocks closed mixed on Wednesday, wrapping up a turbulent April marked by economic contraction and trade policy uncertainty. 

The S&P 500 rose 0.15%, the Nasdaq Composite lost .086%, and the Dow Jones Industrial Average gained 141 points after new data showed the U.S. economy shrank for the first time since 2022.

According to the Commerce Department, first-quarter GDP fell at a 0.3% annualized rate, reversing a 2.4% gain from the previous quarter. 

The contraction was partly attributed to a 41% surge in imports as businesses stockpiled ahead of President Trump’s new tariffs. 

Consumer spending also slowed to its weakest pace in over a year, and government expenditures declined, further dragging on growth.

Tariff uncertainty

Markets had rallied earlier in the month after Trump paused some tariffs and hinted at trade deals with countries like India. But renewed volatility returned as investors digested the weak economic data, inflationary concerns, and lack of clarity on trade negotiations. 

April’s losses follow a sharp drop after Trump’s April 2 announcement of “reciprocal” tariffs, which sent the S&P 500 down more than 11% at one point.

On Truth Social, Trump sought to shift blame for the economic slide, writing, “This is Biden’s Stock Market, not Trump’s,” and claimed a “Biden Overhang” was behind the poor numbers. He urged patience, saying his policies would take time to deliver results.

The stock market under Trump’s second term has posted one of the weakest performances for any president’s first 100 days in modern history. 

Analysts point to continued policy uncertainty as a primary cause. “This is very clearly brought on by the uncertainty surrounding the tariffs, period,” said Kelly Bouchillon of Sound View Wealth Advisors.

Meanwhile, major companies like First Solar and GE HealthCare cut forecasts due to tariff-related headwinds. Nvidia shares also slipped, following disappointing results from Super Micro Computer.