U.S. Stocks Close Tuesday in Red
(MENAFN) U.S. stock markets closed lower on Tuesday, the first trading day following Labor Day, after a pivotal appeals court ruling declared most of President Donald Trump’s tariffs unlawful.
The Dow Jones Industrial Average dropped 0.55%, losing 249.07 points to end at 45,295.81. The Nasdaq Composite fell 0.82%, or 175.92 points, closing at 21,279.63, while the S&P 500 declined 0.69%, slipping 44.72 points to 6,415.54.
Investors’ anxiety was reflected in a sharp 6.51% jump in the Volatility Index (VIX), often dubbed the “fear index,” which surged to 17.17.
Bond markets also reacted with expectations of rising yields in September. The 30-year Treasury yield surpassed 4.97%, while the 10-year Treasury yield climbed to 4.27%.
The sell-off followed the U.S. Federal Court of Appeals’ decision on Friday, which concluded that Trump lacked the constitutional authority to impose most of the tariffs.
“The core Congressional power to impose taxes such as tariffs is vested exclusively in the legislative branch by the Constitution,” the court stated. “Tariffs are a core Congressional power.”
To allow the Trump administration time to appeal to the Supreme Court, the ruling’s implementation has been delayed until October 14.
Speaking at the White House on Tuesday, Trump said he would seek an expedited Supreme Court review. “If you take away tariffs, we could end up being a third-world country,” he warned.
“We’re going to be going to the Supreme Court, we think tomorrow, because we need an early decision,” Trump added, emphasizing the high stakes: the “financial fabric of our country” is on the line.
The president also attributed the market downturn to the ruling, asserting: “They want the tariffs.”
However, analysts suggest that the market’s decline stemmed from uncertainty surrounding the tariffs rather than outright opposition to them.
On the economic front, the ISM manufacturing purchasing managers’ index (PMI) rose to 48.7% in August, marking a 0.7 percentage point increase from July but still falling short of market expectations.
In corporate news, shares of PepsiCo increased 1.1% after Elliott Investment Management revealed it had taken a nearly $4 billion stake in the company. Meanwhile, Kraft Heinz shares plunged almost 7% following the announcement of plans to split the firm into two separate entities.
The Dow Jones Industrial Average dropped 0.55%, losing 249.07 points to end at 45,295.81. The Nasdaq Composite fell 0.82%, or 175.92 points, closing at 21,279.63, while the S&P 500 declined 0.69%, slipping 44.72 points to 6,415.54.
Investors’ anxiety was reflected in a sharp 6.51% jump in the Volatility Index (VIX), often dubbed the “fear index,” which surged to 17.17.
Bond markets also reacted with expectations of rising yields in September. The 30-year Treasury yield surpassed 4.97%, while the 10-year Treasury yield climbed to 4.27%.
The sell-off followed the U.S. Federal Court of Appeals’ decision on Friday, which concluded that Trump lacked the constitutional authority to impose most of the tariffs.
“The core Congressional power to impose taxes such as tariffs is vested exclusively in the legislative branch by the Constitution,” the court stated. “Tariffs are a core Congressional power.”
To allow the Trump administration time to appeal to the Supreme Court, the ruling’s implementation has been delayed until October 14.
Speaking at the White House on Tuesday, Trump said he would seek an expedited Supreme Court review. “If you take away tariffs, we could end up being a third-world country,” he warned.
“We’re going to be going to the Supreme Court, we think tomorrow, because we need an early decision,” Trump added, emphasizing the high stakes: the “financial fabric of our country” is on the line.
The president also attributed the market downturn to the ruling, asserting: “They want the tariffs.”
However, analysts suggest that the market’s decline stemmed from uncertainty surrounding the tariffs rather than outright opposition to them.
On the economic front, the ISM manufacturing purchasing managers’ index (PMI) rose to 48.7% in August, marking a 0.7 percentage point increase from July but still falling short of market expectations.
In corporate news, shares of PepsiCo increased 1.1% after Elliott Investment Management revealed it had taken a nearly $4 billion stake in the company. Meanwhile, Kraft Heinz shares plunged almost 7% following the announcement of plans to split the firm into two separate entities.
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