U.S. stocks experienced a shaky trading day following weaker-than-expected economic reports on Tuesday. Uncertainty remains high regarding President Donald Trump’s upcoming tariff announcements on ‘Liberation Day’ scheduled for Wednesday. The S&P 500 was down by 0.2% in morning trading after nearly erasing an early 1% drop. The Dow Jones Industrial Average fell 222 points, or 0.5%, while the Nasdaq composite rose 0.1%.
In the bond market, Treasury yields dropped after a report indicated U.S. manufacturing activity contracted last month. Companies are already feeling the effects of Trump’s trade war, even before the announcement of new tariffs. Some manufacturers reported slower sales in Canada and concerns about potential boycotts of U.S. products.
Despite overall economic growth, one concern is that even if Trump announces less severe tariffs, the uncertainty surrounding his trade strategy could cause U.S. households and businesses to freeze spending, damaging the economy. Johnson & Johnson dropped 4.6% after a bankruptcy court rejected its settlement plan related to talc-containing baby powder. Airline stocks continued to decline due to economic and global trade concerns.
In Europe, indexes rose after Ursula von der Leyen, European Commission President, stated the EU would not yield to U.S. trade demands. In Japan, Prime Minister Shigeru Ishiba urged Trump not to impose higher auto tariffs on Japan. The yield on the 10-year Treasury fell to 4.14% from 4.23% late Monday, reflecting worries about a potentially slowing U.S. economy.
— new from AP News
