US markets edged lower on Tuesday, surrendering early-session gains as investor concerns over President Donald Trump’s trade policies lingered. Major indexes closed modestly in the red, with the S&P 500 dipping 0.08%, the Dow Jones Industrial Average shedding 0.20%, and the Nasdaq slipping 0.09%.
Why did Nvidia shares fall?
Futures also pointed to a weak start for Wednesday’s session. Dow Jones futures fell 170 points, while S&P 500 futures declined 45 points and Nasdaq futures dropped 250 points. The sharp decline in Nasdaq futures was largely attributed to Nvidia, whose shares tumbled 6% in after-hours trading. The chipmaker announced a $5.5 billion quarterly charge linked to export restrictions on its H20 graphic processing units to China and other countries, sending a wave of caution through the tech sector.
Earlier on Monday, benchmark indexes had traded firmly higher, with the Dow surging as much as 400 points before reversing course in the final hours. By the close, the blue-chip index was down 150 points, while the S&P 500 and Nasdaq both ended below the flatline.
Bank earnings
Shares of Bank of America and Citigroup moved higher after both banks reported earnings, officially closing out the latest bank earnings season. While Wall Street trading desks have benefitted from the recent tariff volatility, concerns remain that prolonged trade tensions and slowing global growth could weigh on other areas of their business.
Boeing hit by China retaliation
Boeing shares slid 2.4% after reports emerged that Beijing has instructed Chinese airlines to halt new orders of the US aerospace giant’s planes. The move signals a further escalation in the US-China trade standoff and adds pressure on one of America’s flagship manufacturers.
Trump’s message to Beijing
President Trump issued a pointed message to China on Tuesday, stating the country should approach the US for a trade deal to ease tariffs because it relies heavily on American consumers. “The ball is in China’s court,” the president said in a statement read at the White House briefing.
European markets
In Europe, luxury stocks fell sharply after LVMH reported declining sales, reflecting the toll of growing trade tensions and weakening Chinese demand. Meanwhile, global carmakers such as Toyota and Hyundai mirrored Monday’s US auto stock rally.
Fresh tariff probes in the pipeline
The market pullback reflects persistent investor unease over trade tensions and sector-specific headwinds, particularly in technology and industrials, keeping sentiment fragile despite recent rebound attempts.
Investors are wary that the US government opened new investigations into potential tariffs on pharmaceutical and semiconductor imports, adding another layer of uncertainty for markets already rattled by tit-for-tat trade measures.