SoFi Technologies Inc. (SOFI) experienced a sharp 5.05% decline in its stock price during Tuesday's trading session, following a significant price target cut by Morgan Stanley. The financial technology company's shares came under pressure as analysts expressed growing concerns about potential headwinds facing the consumer lending sector.

Morgan Stanley, a leading investment bank, recently slashed its price target on SoFi to $6 from $13, while maintaining an Underweight rating on the stock. This drastic reduction reflects mounting worries about the impact of a potential slowdown in consumer spending on fintech lenders like SoFi. Analysts suggest that recent policy changes, including new tariffs, could lead to reduced consumer spending, which in turn might negatively affect SoFi's business model.

Adding to the bearish sentiment, market commentators highlighted the potential for a "lack of liquidity" in the credit market as a result of lower consumer spending. This could lead to reduced lending activities by SoFi and its peers, further pressuring the company's financial performance. As investors digest these concerns, SoFi's stock has experienced significant selling pressure, reflecting the market's reassessment of the company's near-term prospects in light of these potential macroeconomic challenges.