US stocks slip with tariff uncertainty returning to the fore
US equities fell at the open as concerns about trade returned with President Donald Trump planning to deliver tariff warnings later on Monday.
The S&P 500 Index dropped 0.4% by 9:32 a.m. in New York, with all of the eleven sectors in red, declines led by consumer discretionary and healthcare. The Nasdaq 100 slipped 0.6%, and the Dow Jones Industrial Average retreated 0.2%. The Dow is just steps away from hitting a new all-time high.
Among individual stocks, Tesla Inc. shares slid 7.7% after Elon Musk announced the formation of a new political party, deepening his involvement in a pursuit that’s weighed on his most valuable business. Netflix Inc. was downgraded to neutral from buy at Seaport Global Securities, which cites valuation in the wake of strong gains at the streaming-video company. CoreWeave Inc. said it will buy Core Scientific Inc. in an all-stock deal worth about $9 billion.
Trump said he would impose an additional 10% tariff on any country aligning themselves with “the Anti-American policies of BRICS,” in a social media post.
Still, US officials have signaled that trading partners will have until Aug. 1 before tariffs take effect, offering a three-week window for negotiations. Earlier, the administration had warned of a July 9 deadline for countries to reach a deal.
“While stocks are at elevated levels with the recent upward momentum, we could see choppy trading from overbought levels and ongoing tariff uncertainty as President Trump extends his July 9th deadline to August 1st,” said Ivan Feinseth, chief investment officer at Tigress Financial Partners.
The European Union said it’s nearing a framework trade agreement with the US after the head of the bloc’s executive arm, Ursula von der Leyen, held a call with Trump on Sunday.
Meanwhile, treasury Secretary Scott Bessent says he’s going to be meeting with his Chinese counterpart “sometime in the next couple of weeks.”
After both S&P 500 and the Nasdaq 100 climbed to records in the past weeks, a gauge of market sentiment from Bloomberg Intelligence is approaching manic levels – a condition that, if sustained, has historically signaled slower forward returns and a shift toward more defensive market leadership.
Later this week, investors will turn their focus to the meeting minutes from the Federal Reserve’s June rate decision.
“In a quiet week for economic releases, the most important will be the minutes of the Fed’s June decision,” said Bill Adams, chief economist for Comerica Bank. “They will probably reinforce that the Committee expected to hold interest rates steady at their July decision when they met in June.”