New York (AP) – Wall Street exhibited stability on Tuesday following a surge the previous day fueled by optimism regarding the scope of President Donald Trump’s proposed tariffs. The S&P 500 remained largely unchanged during afternoon trading after experiencing a 1.8% increase on Monday. The Dow Jones Industrial Average saw a slight decline of 48 points, or 0.1%, as of 1:57 p.m. Eastern time, while the Nasdaq composite recorded a 0.2% gain. U.S. stocks have managed to recover a significant portion of their recent losses, rebounding from a 10% decline below their all-time high earlier in the month, marking their first “correction” since 2023. The S&P 500 currently stands approximately 6% below its record high, making the market appear more attractively priced compared to its previous levels following a period of robust growth. However, market analysts caution that further sharp fluctuations are probable, particularly with an approaching April 2 deadline—a date Trump has labeled “Liberation Day” when he is set to impose a series of tariffs on trading partners in an effort to equalize perceived trade imbalances.
The resurgence on Wall Street on Monday was driven by growing speculation that Trump’s planned “reciprocal” tariffs may be more targeted than initially anticipated. Ajay Rajadhyaksha, Barclays’ global head of research, emphasized the market’s underestimation of the potential tariff impact and highlighted the noteworthy stability of the Mexican peso and Canadian dollar following the recent tariff postponement. Even if the actual implications of Trump’s tariffs turn out to be less severe on the global economy than feared, the ongoing uncertainty surrounding the tariffs has already dampened consumer and business confidence in the U.S., raising concerns about potential spending cutbacks and economic stagnation.
Recent data indicating a growing pessimism among U.S. households underscores the prevailing apprehensions in the market. The Conference Board’s consumer confidence index revealed a significant decline, primarily driven by dimmed expectations for the near future economic conditions. The index now stands at its lowest level in 12 years, falling well below the typical recession threshold of 80. Although current economic activity and job market indicators remain relatively stable, the prevailing negative sentiment among U.S. households and businesses paints a worrisome picture for the economy.
On the corporate front, Trump Media & Technology Group saw a 6.7% increase following an announcement regarding its collaboration with Crypto.com to offer “America-First” investment funds. The exchange-traded funds will feature a mix of bitcoin, digital assets, and U.S.-focused securities, operating under the Truth.Fi brand. Conversely, homebuilder KB Home suffered a 4.6% decline after reporting lower-than-expected profit and revenue figures for the recent quarter, amid concerns of rising costs due to potential tariffs. Additionally, global sales figures from Tesla pointed to a significant drop in European sales, attributed to various factors including stiffening competition and recent controversies surrounding the company’s CEO Elon Musk.
Overall, global stock markets witnessed mixed trends, with European indexes registering gains following a diverse performance in Asian markets. In the bond market, Treasury yields saw a slight decrease, with the 10-year Treasury yield slipping to 4.30% from 4.34% at the close of trading on Monday.