S&P 500 Closes Lower Amid Volatility: What to Expect Next

S&P 500 Falls Amid Choppy Trading Session

On Monday, April 7, 2025, the S&P 500 closed at 5,062.25, down 0.2% from the previous trading session. The Dow Jones Industrial Average posted a steeper drop of 0.9%, ending the day at 37,965.60, while the Nasdaq Composite managed to eke out a small gain of 0.1%, closing at 15,603.26.

The session was marked by heightened volatility, with the Dow experiencing an intraday swing of more than 2,500 points. This kind of market turbulence has become increasingly common amid persistent macroeconomic uncertainty, with the spotlight currently on U.S. trade policy and its ripple effects across global markets.

One of the primary drivers behind Monday’s market movements was President Donald Trump’s renewed push on tariffs, including threats of further levies on Chinese imports. This hardline stance is reviving fears of an extended trade war, a scenario that could weigh heavily on global growth and corporate earnings. According to AP News, traders are reacting swiftly to signs that U.S.-China tensions might escalate again.

Outlook for the Next Trading Session

As we look ahead, the market is expected to remain volatile. Investors should brace for further uncertainty as trade rhetoric continues to dominate headlines. According to Morgan Stanley, the S&P 500 could still face a further 7% to 8% decline, as markets have yet to fully price in a more defensive economic outlook. Read more on this perspective from MarketWatch.

In addition to trade concerns, investors will be eyeing upcoming economic data, including inflation figures and the latest jobless claims report. These indicators could heavily influence investor sentiment and Fed policy expectations.

While some analysts warn that the market is not yet ripe for a rebound, others see selective opportunities—especially in defensive sectors like healthcare and utilities, which tend to perform better during periods of economic contraction. However, as Barron’s recently noted, the recent selloff hasn’t reached the level of capitulation that typically signals a bottom.

Conclusion

In summary, the latest S&P 500 pullback reflects growing investor unease over trade tensions and potential economic headwinds. The path forward remains uncertain, with the next trading session likely to mirror recent volatility. Market participants should stay alert to policy developments, economic indicators, and sentiment shifts that could sway the markets dramatically in either direction.