US stocks drifted lower Tuesday as Wall Street’s recent momentum slowed and shares of Tesla tumbled sharply amid an escalating rift between Elon Musk and President Donald Trump.
The S&P 500 slipped 0.3% and appeared on track to break a three-day winning streak that had carried it to record highs. The Dow Jones Industrial Average dipped by 30 points, while the tech-heavy Nasdaq composite fell 0.4%, AP reported.
Tesla was a major drag on the market, dropping more than 5% overnight as tensions escalated between Musk and Trump. The dispute flared anew after Musk said he’s considering forming a new political party, and Trump responded with renewed criticism of Tesla's electric vehicle subsidies and other government incentives.
“Shares of Tesla tumbled more than 5% overnight after the war of words... heated up again,” AP reported, noting that Trump has slammed Musk over what he called “massive tax breaks” while Musk criticised Trump’s tariff strategy.
Wall Street futures were already pointing lower before the market opened Tuesday. Futures for the Dow slipped 0.2%, S&P 500 futures dropped 0.3%, and Nasdaq futures declined 0.5%.
The broader economic backdrop remained cautious. Treasury yields held relatively steady ahead of key reports on manufacturing activity and job openings. Economists are watching closely for multiple labour market updates due later in the week.
Investors are also awaiting a panel discussion on European Central Bank policy that will include Federal Reserve Chair Jerome Powell. The Fed has kept interest rates unchanged so far this year amid ongoing uncertainty over the economic impact of Trump’s tariffs.
Trump’s decision to pause or delay several planned tariffs earlier this year helped power a strong rebound in US equities following a tariff-fuelled slide in the spring. However, with some of those measures still looming, the US dollar continued to weaken. It fell to 142.74 Japanese yen on Tuesday from 144.04 yen and is now down more than 9% this year.
In Europe, Britain’s FTSE 100 shed 0.3%, Germany’s DAX lost 0.6%, and France’s CAC 40 fell 0.5% in midday trading.
In Asia, Japan’s Nikkei 225 dropped 1.2% to 39,986.33 despite stronger-than-expected sentiment in the Bank of Japan’s latest Tankan survey of large manufacturers. Meanwhile, China’s Shanghai Composite rose 0.4% to 3,457.75 following a three-month high in both manufacturing and services PMI data.
South Korea’s KOSPI added 0.6% to 3,089.65 on strong June exports, particularly for semiconductors, ships, and health products. “We expect auto exports to remain soft due to tariffs and increased production in the US,” ING Economics’ Min Joo Kang noted in a report.
Australia’s S&P/ASX 200 dipped 0.1% to 8,541.10, while markets in Hong Kong were closed for the day.
In energy trading, US crude oil gained 58 cents to $65.69 a barrel, and Brent crude, the international benchmark, rose 50 cents to $67.24 per barrel.
Stay informed with the latest business news, updates on bank holidays and public holidays.
AI Masterclass for Students. Upskill Young Ones Today!– Join Now
The TOI Business Desk is a vigilant and dedicated team of journal...
Read MoreThe TOI Business Desk is a vigilant and dedicated team of journalists committed to delivering the latest and most relevant business news from around the world to readers of The Times of India. The primary focus of the TOI Business Desk is to keep a watchful eye on the global business landscape, covering a wide spectrum of industries, markets, economic trends, in-depth analysis, exclusive reports and breaking stories that impact businesses and economies. With a mission to provide valuable insights and updates, the desk ensures that TOI readers are well-informed about the ever-changing and dynamic world of commerce and can navigate the complexities of the business world.
Read Less
Start a Conversation
Post comment