Financial markets faced a sharp downturn on March 10, with both crypto and tech stocks taking considerable hits as recession fears escalated. JPMorgan economists revised their forecast for the US recession probability to 40%, an increase from 30% at the beginning of 2025, citing risks associated with economic policies.
“We see a material risk that the U.S. falls into recession this year owing to extreme U.S. policies,” JPMorgan analysts stated, according to The Wall Street Journal.
“Vemos un riesgo material de que EE. UU. caiga en recesión este año debido a políticas extremas de EE. UU.”
Their assessment was echoed by Goldman Sachs, which raised its 12-month recession forecast from 15% to 20%, cautioning that the risk could grow further if the current economic policies continue under the Trump administration, despite deteriorating economic indicators.
Morgan Stanley Adjusts US GDP Projections to 1.5%, Warns of Rising Inflation
Further intensifying concern, Morgan Stanley updated its growth predictions, forecasting a US GDP growth of merely 1.5% for 2025, declining to 1.2% by 2026. The firm also amplified its inflation forecasts, indicating prolonged financial instability.
Despite these warnings, Kevin Hassett, head of the National Economic Council, downplayed the concerns, insisting that the US economy remains robust. In a CNBC conversation on March 10, he acknowledged minor economic “blips” but pointed out that there were still ample reasons for optimism.
In a Fox News interview dated March 9, President Donald Trump referred to the economic slowdown as a “period of transition,” disregarding the worries of an impending recession.
Investor sentiment has become decidedly negative in recent weeks, resulting in the erasure of what was once dubbed the “Trump bump.” The S&P 500 has plummeted below its pre-election levels, shedding nearly 10% from the peak reached last month. The Nasdaq has entered correction territory, having dropped 14% in just three weeks.
On March 10, all major US stock indices closed in decline. The S&P 500 fell by 2.7%, marking its lowest point since September. The tech-heavy Nasdaq experienced a plunge of 4%, the worst single-day drop since 2022, while the Dow Jones Industrial Average sank nearly 900 points (2.1%).
The “Magnificent 7”—the leading tech companies in America—lost an alarming $750 billion in market capitalization in a single day. Tesla was hit hardest, losing 15%, making it the worst-performing stock on the S&P 500 this year. Nvidia fell by 5.1%, Apple dropped 4.9%, Meta slid by 4.4%, and Alphabet went down by 4.5%.
Crypto Markets Dive Amid Economic Doubts
Simultaneously, the crypto market endured a drastic decline, hitting its lowest levels since early November. On March 11, the overall crypto market valuation decreased by 7.5% to $2.6 trillion, with $240 billion leaving the sector. Bitcoin (BTC) broke through significant support levels, declining 4% on the day and briefly touching $76,784 before recovering to $79,000 at the time of this report.
