S&P 500, Nasdaq slip after latest Trump tariff salvo

The S&P 500 and the Nasdaq fell modestly on Monday as investors assessed U.S. President Donald Trump’s latest tariff announcement ahead of the Federal Reserve’s monetary policy decision later this week.

On Sunday, Trump announced a 100% tariff on movies produced outside the U.S. but provided no details on how such levies would be implemented.

Stocks have been volatile since Trump announced his first round of tariffs on April 2, with the S&P 500 initially dropping nearly 15%, only to stabilize and climb for the last nine straight sessions, its longest streak since 2004.

On Monday, Treasury Secretary Scott Bessent said Trump’s tariff, tax-cut and deregulation agenda would work together to drive long-term investment to the U.S., adding markets could overcome any short-term turbulence.

“Nine up days in the S&P 500 is hard to maintain,” said Art Hogan, chief market strategist at B Riley Wealth in Boston.

“We are starting to price in that eventuality of deals being announced, but we’re running out of daylight on that because every week that goes by that we don’t start cutting deals we’re doing economic damage.”

The Dow Jones Industrial Average rose 104.18 points, or 0.25%, to 41,422.35. The S&P 500 lost 9.60 points, or 0.17%, at 5,677.07 and the Nasdaq Composite fell 39.60 points, or 0.22%, to 17,938.13.

The Dow was on track for its tenth straight winning session, which would mark its longest since a 13-session run in July 2023.

Several movie and television production pared losses after falling on Trump’s announcement.

Netflix fell 1.5%, on track to snap an 11-session winning streak, while Amazon.com was down 1.5%. Paramount Global shed 1.1%.

Energy was down 1.5%, the worst performer of the 11 major S&P sectors, after OPEC+ decided to speed up its output hikes, causing concerns about more supply as demand remains uncertain.

Class B shares of Berkshire Hathaway were down 4.3% after Warren Buffett said he will step down as CEO of the conglomerate.

On the economic front, the Institute for Supply Management’s (ISM) survey showed the services sector’s growth picked up in April, while a measure of prices paid by businesses for materials and services raced to the highest level in more than two years as the tariffs trickle down to price tags.

Investors will closely eye the Fed’s policy announcement on Wednesday, in which the central bank is largely expected to keep interest rates unchanged. Commentary from Fed Chair Jerome Powell will be scrutinized for signs of when the Fed will adjust monetary policy.

Markets are pricing in a total of 73 points of rate cuts by the Fed for 2025, with the first easing of at least 25 basis points likely at the central bank’s July meeting, according to LSEG data.

Investors are also concerned about how tariffs may affect corporate profitability. Tyson Foods tumbled 7.5% after the meat packer missed quarterly revenue expectations.

However, Skechers jumped nearly 25% after the footwear maker agreed to be taken private by 3G Capital in a $9.4 billion deal.

Declining issues outnumbered advancers by a 1.16-to-1 ratio on the NYSE and by a 1.18-to-1 ratio on the Nasdaq.

The S&P 500 posted nine new 52-week highs and three new lows, while the Nasdaq Composite recorded 50 new highs and 45 new lows.