Why did Corcept, Johnson & Johnson, and Southwest Airlines fall on April 1, 2025?

On April 1, 2025, U.S. equity markets faced heavy sectoral pressure as a large number of high-growth and trade-sensitive stocks saw steep intraday declines. This sharp pullback was driven by investor unease over the expected unveiling of sweeping new import tariffs by U.S. President Donald Trump. Dubbed “Liberation Day,” the planned announcement on April 2 has cast a long shadow over equity valuations, particularly in biotechnology, pharmaceuticals, aviation, and Chinese tech stocks.

Among the day’s top laggards were Corcept Therapeutics Incorporated, Johnson & Johnson, and Southwest Airlines Co., with more than two dozen other companies also seeing significant drops. These losses come amid fresh macroeconomic concerns and renewed questions over cost structures, inflationary pressure, and global supply chain risk—all amplified by trade policy uncertainty.

How did Corcept Therapeutics and Vaxcyte lead the biotech selloff?

Corcept Therapeutics Incorporated posted the steepest decline of the day, plunging 19.51% to $91.93, despite entering 2025 with strong year-on-year gains. Known for its work on cortisol modulation therapies, Corcept has been a biotech darling in recent quarters. However, with valuation multiples running high, the stock was among the first to be repriced amid macro-driven risk aversion.

Biotech peers followed suit. Vaxcyte Inc. dropped 14.65% to $32.23, amid continued volatility for clinical-stage vaccine developers. The firm’s market cap, already down nearly 50% from its 52-week high, contracted further as investors feared a combination of capital constraints and increasing costs tied to global manufacturing inputs.

Immunovant Inc., developing therapies for autoimmune conditions, fell 11.06% to $15.20. Risk sentiment surrounding clinical-stage biotech remains fragile, and Immunovant—despite a promising pipeline—was not spared from the selloff. This was mirrored in the performance of Ionis Pharmaceuticals Inc., which lost 9.65%, and Avidity Biosciences Inc., down 9.42%, both facing the dual pressure of higher input costs and investor rotation out of speculative healthcare names.

Mid-cap biotech players such as Crinetics Pharmaceuticals Inc. and Xenon Pharmaceuticals Inc. fell 8.71% and 8.67% respectively, while PTC Therapeutics Inc. lost 8.56%, and Arcellx Inc. fell 7.47%. The consistent pattern across these names suggests a sentiment-driven exodus, as investors brace for disruptions to cross-border pharmaceutical trade.

Why did Johnson & Johnson lose nearly 8% despite its defensive profile?

Healthcare conglomerate Johnson & Johnson saw its shares fall 7.59% to $153.25, shedding billions in market value. Although typically considered a defensive play due to its diversified operations and strong cash flow, J&J has been grappling with renewed scrutiny over legacy litigation and potential tariff exposure. Market participants are increasingly pricing in higher costs for imported raw materials used in pharmaceutical and medical device production.

Other names in the same space echoed the sentiment. Legend Biotech Corporation fell 7.10%, MoonLake Immunotherapeutics declined 6.96%, and Ultragenyx Pharmaceutical Inc. slid 6.55%. Investors appear to be broadly re-evaluating the earnings trajectories for biotech and pharma companies as global trade uncertainty mounts.

Why are airline and energy stocks like Southwest and Excelerate Energy vulnerable to trade shifts?

Southwest Airlines Co. dropped 5.93% to $31.59 as the airline sector absorbed dual blows from rising energy costs and recession fears. The prospect of higher import costs feeding into inflation could dampen consumer spending and discretionary travel, eroding airline profitability in the quarters ahead. With the airline industry already grappling with elevated jet fuel prices and tight labor markets, the added risk of trade policy fallout is further weakening investor confidence.

Meanwhile, Excelerate Energy Inc. fell 7.04% to $26.66. The liquefied natural gas (LNG) infrastructure player is particularly sensitive to geopolitical shifts and regulatory regimes. If new tariffs disrupt international energy trade or infrastructure development, names like Excelerate could see margin compression and project delays.

How did China-linked stocks like Xiaomi and Pony AI respond to tariff risk?

China-based autonomous driving technology firm Pony AI Inc. declined 10.54% to $7.89. While the company has made headway in the U.S. robotaxi market, growing concerns about Washington-Beijing tensions—especially around AI and semiconductors—have significantly dampened investor sentiment.

Xiaomi Corporation, trading over-the-counter in the U.S., fell 5.99% to $5.96. The consumer electronics giant faces significant exposure if electronics components or finished goods become subject to new U.S. import restrictions. Xiaomi’s U.S. footprint, though limited compared to rivals like Apple, still leaves it vulnerable in an escalating trade war.

MicroAlgo Inc., another AI-linked Chinese name, dropped 6.80% as investors pulled capital from names perceived to be high risk amid regulatory volatility and geopolitical tension.

What macroeconomic signals are shaping investor sentiment right now?

The losses on April 1 coincided with a disappointing manufacturing report. According to newly released data, U.S. manufacturing activity contracted in March, with the ISM index falling below 50. This suggests a reversal from modest growth seen earlier in the year and compounds fears of a broader economic slowdown.

At the same time, markets are dealing with persistent inflation, high interest rates, and reduced liquidity. The S&P 500 may have ended the day up 0.4%, and the Nasdaq gained 0.9%, but both indexes have shown signs of fragility. The S&P 500 is now down 4.6% for the quarter, its worst showing since mid-2022, highlighting just how precarious investor confidence has become.

How are investors positioning ahead of Trump’s ‘Liberation Day’ tariff rollout?

Investor focus is now squarely on President Trump’s scheduled remarks on April 2, where a package of sweeping import tariffs—reportedly ranging from 20% to 25%—could be unveiled. The administration has hinted that sectors such as automotive components, pharmaceuticals, electronics, and raw materials may be targeted.

As a result, investors are pulling out of names most exposed to cross-border cost increases. This includes a wide swath of biopharma companies with complex global supply chains, airlines that depend on stable energy prices, and tech players reliant on Chinese manufacturing.

Among other notable April 1 declines were Scholar Rock Holding Corporation (-6.50%), Cytokinetics, Incorporated (-6.69%), Verona Pharma plc (-7.80%), Merus N.V. (-5.92%), Impala Platinum Holdings Limited (-5.94%), Biohaven Ltd. (-5.99%), and Coeur Mining, Inc. (-5.74%). Each of these companies operates in sectors particularly sensitive to commodity costs, foreign inputs, or regulatory shifts.

As April progresses, the ripple effects from policy decisions could define market performance, especially for small- and mid-cap firms that lack pricing power and global diversification.