U.S. stock indexes ended mostly flat Tuesday following a choppy trading session, as Wall Street continued to absorb the Trump administration’s latest escalation in its global tariff campaign aimed at pressuring nations into trade concessions.
The S&P 500 slipped 4.46 points, or 0.1%, to 6,225.52, a day after logging its steepest loss since mid-June. The Dow Jones Industrial Average fell 165.60 points, or 0.4%, to 44,240.76, while the Nasdaq composite managed a modest gain of 5.95 points, or less than 0.1%, to close at 20,418.46. Both the S&P 500 and Nasdaq remain near record highs.
Markets struggled to find direction following President Donald Trump’s decision to impose new tariffs, including a 25% levy on goods from Japan and South Korea, as well as revised duties on imports from a dozen other nations. The new rates are scheduled to take effect Aug. 1, replacing a previous 90-day tariff delay set to expire this week.
“Today you’re basically seeing a market that doesn’t quite believe the worst of this is going to come to bear,” said Ross Mayfield, investment strategist at Baird. “It’s just kind of waiting for any sort of clarity, because we seem to be back in that phase where things change every couple of hours.”
Trump announced the tariffs by posting letters to foreign leaders on Truth Social, warning against retaliation. “We have tremendous power at the White House to run places when we have to,” Trump said later during a Cabinet meeting.
In addition to trade duties, Trump said he would soon announce a 200% tariff on pharmaceutical drugs and sign an executive order placing a 50% tariff on copper imports, aligning it with rates on steel and aluminum.
Those comments sent copper prices for September delivery soaring 13.1% to $5.69 per pound, while Freeport-McMoRan, a major copper producer, climbed 2.5%.
Despite the uncertainty, some analysts saw Trump’s latest moves as posturing.
“At a very basic level, nothing actually happened based on Trump sending these letters,” wrote Tobin Marcus, an analyst at Wolfe Research. “But we think these moves do contain some signal about where the trade war is heading, and that signal is mostly hawkish.”
In the bond market, Treasury yields rose slightly. The yield on the 10-year Treasury inched up to 4.40% from 4.39% late Monday.
Tuesday’s modest moves come after stocks surged last week on stronger-than-expected jobs data. Investors now await further insight from the Federal Reserve, which will release minutes from its latest policy meeting on Wednesday. Fed Chair Jerome Powell has indicated the central bank will assess the economic impact of the tariffs before taking further action on interest rates.
In international markets, major indexes closed higher across Europe and Asia. South Korea’s Kospi surged 1.8%, and Hong Kong’s Hang Seng rose 1.1%.
Meanwhile, the National Federation of Independent Business reported its small business optimism index declined slightly last month, in line with expectations. The index tracks sentiment around the economic outlook and operating conditions for small firms.
