Market indicators sagged significantly on Monday, retreating from previously attained highs as the investment community surveyed a barrage of news revolving around import duties and global commerce. The recognizable S&P 500 index recorded a decline of 0.8%, moving away from its apex. Similar downturns were observed in the Nasdaq Composite, which is largely tech-centric, and the Dow Jones Industrial Average, with each experiencing a contraction of 0.9%.
Investors were set aback after last week’s positive performance, as the S&P 500 and Nasdaq Composite initiated Monday’s trading from record-breaking levels. Additionally, the Dow waited impatiently, just below the margin of 0.5% off its first new summit since the winter month of December.
A significant announcement came from the U.S. President on Monday, revealing that as of August 1, imported goods from key trading allies Japan and South Korea would be subjected to a 25% import duty. In addition, tariffs varying between 25% to 40% would impact several smaller nations unless they eliminated trade obstructions.
Financial markets initially experienced turbulence back in April due to the unveiling of these tit-for-tat tariffs. These import duties, after a hold-off of 90 days, were presumed to be reinstated on July 9.
Pressure began mounting on other massive technology stocks as well, which have been instrumental in recent market surges. The share prices of tech giants, Apple and Alphabet, slid down by 1.7%. Others like Nvidia, Microsoft, Meta Platforms and Broadcom also glimpsed declines, albeit to a lesser extent.
As an exception, Amazon concluded the trading day with a marginal increase in its stock price. Various big names in the technology sector also elicited attention with their stock movement. Chip-designer company Arm Holdings and chip manufacturer Marvell Technology each witnessed a drop of around 5%.
Also tracking lower was ON Semiconductor, which dipped by 3.5%, as the entire chip manufacturing segment experienced a slump. Contrarily, the data analytics software company Palantir bucked the trend and ascended by 3.5%, distinctly leading the advancers in the Nasdaq 100 index.
Shedding light on the bond market, the yield on the 10-year Treasury note – a key influencer of loan borrowing costs – increased slightly, reaching 4.38% from its last week’s closing of 4.34%, representing its highest point in two weeks.
The U.S. dollar index, a tool comparing the performance of the American dollar against an array of international currencies, picked up 0.4% to ascend to 97.54. This was especially noteworthy as the index had recorded its lowest point since early 2022 the previous week.
In the commodities market, gold futures saw a small uptick of 0.1%, with the per-ounce price reaching $3,345 during the later hours of Monday’s trading session. Meanwhile, West Texas Intermediate futures, setting the standard for U.S. crude oil prices, also observed an increase of 1.4%, with price per barrel landing at $67.90.