Shopify (SHOP) shares experienced a significant plunge of 19.17% on Thursday, as investors reacted to a combination of company-specific concerns and broader market turmoil. The e-commerce giant's stock was hit hard following a warning from Bank of America (BofA) about the company's high exposure to recently announced tariffs, compounded by a broader market sell-off triggered by escalating trade tensions and recession fears.

BofA analysts raised alarm bells about Shopify's potentially high vulnerability to the latest round of tariffs, which could significantly impact e-commerce vendors using the platform. This assessment sparked worries among investors about the potential negative effects on Shopify's business model and financial performance. As a leading provider of e-commerce solutions for businesses of all sizes, Shopify's sudden stock drop underscores the sensitivity of technology companies to regulatory and trade policy changes that could affect their merchant base.

The company's stock decline was further exacerbated by a broader market downturn, with the S&P/TSX Composite Index falling 3.84% amid concerns over U.S. President Donald Trump's new reciprocal tariffs. These tariffs have escalated global trade war fears and sparked worries of a potential recession. While Canada avoided some of the new levies due to the USMCA trade agreement, the overall market sentiment remained negative, particularly affecting technology and e-commerce stocks like Shopify. As the market continues to digest these developments, investors will be closely watching how Shopify addresses these concerns and whether the company can mitigate the potential impact of increased tariffs on its operations and growth prospects.