The definitive results of the trading session showed the Dow Jones Industrial Average dropping by 0.94%, the tech-heavy Nasdaq falling by 0.92%, and the broader S&P 500 declining by 0.79%.
“Tariffs now seem much more tangible to the market,” emphasized Steve Sosnick, an analyst at Interactive Brokers, to Agence France-Presse (AFP).
The U.S. President today announced a 25% tariff surcharge on Japan, South Korea, Kazakhstan, and Malaysia, marking a new step in his campaign to disrupt international trade.
The surcharge will be more severe for South Africa (30%), but especially for Laos and Myanmar (both with 40%).
These additional tariffs will be imposed “starting from August 1st,” according to Trump.
The U.S. head of state had previously scheduled the additional tariffs to take effect on July 9th.
Washington also assured that any retaliatory tariffs would be countered with a new U.S. tariff of equal magnitude.
“There are still opportunities for negotiations (…) and as long as they exist, investors will not react drastically,” Sosnick observed.
Market participants are accustomed to Trump’s frequent changes of stance on trade, and “no one wants to overreact now,” the analyst added.
Additionally, “this week promises to be poor for economic data, and earnings season only starts next week,” he noted.
“The market is a bit reluctant to sell” and prefers to remain watchful, he added.
Wall Street is awaiting the release of the minutes from the U.S. Federal Open Market Committee (FOMC) meeting on Wednesday.
In the bond market, the yield on the 10-year U.S. Treasury note rose to 4.39% around 9:15 PM Lisbon time, compared to 4.35% at Friday’s close.
Shares of electric vehicle specialist Tesla fell by 6.79% to $293.94 after its CEO, Elon Musk, announced on Saturday the creation of his own political party, the “America Party.”
“Tesla investors were finally hoping Musk would focus entirely on (…) his business interests and not his political interests,” Sosnick further explained.
“This announcement is being seen exactly as the kind of distraction investors do not want,” he pointed out.
Ride-hailing giant Uber gained ground (+3.25%, to $96.67), demonstrating investor confidence in the group thanks to the expansion of its services, particularly through its partnership with autonomous vehicle startup Waymo.
Shares of prison companies like GEO Group (+4.38%, to $26.46) and Corecivic (+3.97%, to $22.53) followed suit after Trump endorsed his “big, beautiful budget bill,” which includes a significant increase in funding for migrant detention centers.
