Wall Street is bracing for more pain this week as U.S. stock futures took a steep dive Sunday evening, extending last week’s historic sell-off. Dow Jones Industrial Average futures plummeted over 1,500 points, or nearly 4%, signaling more losses at Monday’s market open. S&P 500 and Nasdaq 100 futures also dropped sharply—down 4.2% and 5.1%, respectively.

This drop comes after a brutal week that saw the Dow fall 7.9%, the S&P 500 drop 9.1%, and the Nasdaq lose 10%, pushing it firmly into bear market territory—defined as a 20% fall from its recent peak. The sudden decline wiped out trillions in market value and triggered panic among investors already uneasy about the state of the global economy.

Fueling the sell-off are renewed fears of a prolonged trade war following President Donald Trump’s announcement of sweeping tariffs on imports. China swiftly retaliated with 34% tariffs of its own, deepening investor concern and driving more volatility across global markets.

Despite the chaos, President Trump doubled down on his aggressive trade stance over the weekend. “Unless we solve that problem, I’m not going to make a deal,” Trump said, referring to long-standing trade imbalances with China. He emphasized that his administration is committed to correcting what he calls “unfair trade practices” and signaled no rush to negotiate until those issues are addressed.

Top Trump advisers defended the strategy. Treasury Secretary Scott Bessent dismissed the market panic as temporary, saying the tariffs are part of a “strategic reset” to support long-term economic health. “We are correcting decades of imbalance. This is a necessary adjustment,” Bessent said, pointing to recent job growth as a sign of resilience.

White House trade adviser Peter Navarro echoed the sentiment, downplaying fears of a recession. “There may be short-term pain, but this is part of building a stronger, more self-reliant American economy,” Navarro said.

Still, analysts warn that investor confidence is quickly eroding. “The market’s reaction is a direct reflection of rising uncertainty,” said one Wall Street strategist. “If the rhetoric doesn’t cool down, we could be in for a rough ride.”

Market watchers are now looking to key economic data due later this week, including inflation reports and consumer sentiment numbers. Federal Reserve Governor Adriana Kugler is also set to speak at Harvard on inflation dynamics, which may provide clues on the central bank’s next move.

For now, investors are left to navigate one of the most turbulent market periods in recent memory, with geopolitical tensions and economic policy clashing in real time.