US STOCKS-Wall Street gyrates as investors caught in Trump-tariffs limbo

By David French and Pranav Kashyap

April 1 (Reuters) - U.S. stock indexes struggled for direction in topsy-turvy trade on Tuesday, initially bouncing off session lows before losing some momentum into the afternoon session, as investors awaited details on fresh U.S. tariffs set to be announced on Wednesday.

Financial markets had been volatile in recent weeks as investors assessed the economic fallout of U.S. President Donald Trump's extensive tariff plans, which have sparked worries about a U.S. economic slowdown and higher inflation.

The benchmark S&P 500 .SPX closed the first quarter 4.6% lower, marking its most dismal three-month stretch since July 2022.

"The market is pricing in the worst-case scenario, and if we aren't yet at washout levels then we're pretty close," said Gina Bolvin, president of Bolvin Wealth Management Group in Boston. "I wouldn't be a seller into this correction."

White House aides have drafted plans for 20% tariffs on most goods imported to the United States, the Washington Post reported on Tuesday. Trump is due to unveil his tariff plan at 4 p.m. EDT at an event in the Rose Garden on Wednesday.

After falling about 1% earlier, the S&P 500 gained ground through support from beaten-down technology shares, before momentum ebbed into the afternoon.

At 1:54 p.m. EDT, the S&P 500 had gained 6.92 points, or 0.12%, to 5,618.70 points.

Big tech names remained a source of support, led by Tesla TSLA.O, which gained 6.4% ahead of its first-quarter vehicle deliveries report on Wednesday.

Other Magnificent Seven stocks, including Amazon.com AMZN.O, Microsoft MSFT.O, Nvidia NVDA.O and Meta Platforms META.O, rose between 0.5% and 1.7%.

The benchmark index, however, was weighed down by falls in healthcare and airlines.

Johnson & Johnson JNJ.N fell 6.1%, the biggest percentage drop in the S&P 500, dragging the broader healthcare sector .SPXHC to the bottom of the 11 S&P sectors. A U.S. bankruptcy judge rejected the company's $10 billion proposal to end tens of thousands of lawsuits alleging that its baby powder and other talc products cause ovarian cancer.

Meanwhile, Delta Air Lines DAL.N, American Airlines AAL.O and Southwest Airlines LUV.N all dropped between 2.9% and 5.8%, as Jefferies analysts downgraded stocks amid concerns that economic uncertainty could disrupt both business and retail travel demand.

The other two main stock indexes were mixed. The Nasdaq Composite .IXIC gained 104.64 points, or 0.60%, to 17,403.92 points, rising thanks to the same big tech names. However, the Dow Jones Industrial Average .DJI fell 93.25 points, or 0.22%, to 41,908.51 points.

In non-tariff news, investors appeared to look past data that showed U.S. manufacturing contracted in March after expanding for two consecutive months, while a measure of inflation at the factory gate jumped to the highest level in nearly three years amid rising anxiety over tariffs on imported goods.

A labor report also showed job openings fell to 7.568 million in February.

Goldman Sachs on Monday raised the probability of a U.S. recession to 35% from 20% and said it expects more U.S. interest rate cuts this year.

Among single stocks, PVH Corp PVH.N climbed 18.7% after the apparel maker's annual earnings forecast beat analysts' estimates.

Technology outsourcing firm WNS Holdings WNS.N advanced 6.1% after Reuters reported it was exploring a sale after attracting takeover interest.

Conservative news outlet Newsmax NMAX.N jumped 114%, following a more than 700% surge in its NYSE debut on Monday.

CoreWeave CRWV.O, which has had a more rocky start since debuting as a public company on Friday, climbed 21.4% to trade back above the IPO price of the artificial intelligence startup.