Market Overview
The S&P 500 Index ($SPX), along with the Dow Jones Industrials Index ($DOWI) and the Nasdaq 100 Index ($IUXX), saw declines on Tuesday. The S&P 500 fell by -0.69%, the Dow by -0.55%, and the Nasdaq by -0.79%. Additionally, September E-mini S&P futures (ESU25) decreased by -0.65%, and September E-mini Nasdaq futures (NQU25) dropped by -0.76%.
Market Sentiment and Influences
Stock indexes faced a downturn as the S&P 500 and Nasdaq 100 hit 1.5-week lows, while the Dow Jones reached a 1-week low. The increase in bond yields, with the 10-year T-note yield rising by +5 basis points to 4.28%, contributed to a risk-averse atmosphere across markets. Concerns regarding government finances and persistent inflation risks led to higher global bond yields.
Economic Reports Impact
Losses in stock indexes persisted following the release of U.S. economic data. The ISM manufacturing index for August rose only slightly to 48.7, falling short of the anticipated 49.0, while construction spending for July fell for the third straight month, matching expectations with a -0.1% month-over-month decline.
Upcoming Economic Calendar
This week’s economic calendar is packed with events. On Wednesday, July JOLTS job openings are expected to decrease by -64,000. Factory orders are projected to drop by -1.4% month-over-month. The Fed’s Beige Book will also be released, alongside anticipated increases in ADP employment numbers on Thursday. Several other key reports including productivity revisions and trade deficit projections are scheduled.
Court Ruling on Tariffs
In a recent federal ruling, the court determined that President Trump overstepped his authority with global tariffs imposed without Congressional consent, though the tariffs remain in place pending further appeals. The average U.S. tariff is projected to rise to 15.2% if implemented, significantly higher than earlier rates.
Global Stock Market Trends
Internationally, stock markets displayed mixed results. The Euro Stoxx 50 declined by -1.42%, marking a three-week low, while China’s Shanghai Composite dropped by -0.45%. Conversely, Japan’s Nikkei Stock 225 saw a slight increase of +0.29%.
Major Movements in U.S. Stocks
Prominent technology stocks known as the Magnificent Seven experienced losses, impacting the broader market. Major players like Nvidia, Amazon, Apple, and Tesla fell by over -1%. Chip stocks also pressured the market, with ARM Holdings seeing a -4% decrease. Meanwhile, Cytokinetics soared by over +40% following positive trial results in heart disease therapy, highlighting significant movements in both directions across various sectors.
