In This Story
The stock rally faltered on Tuesday as U.S. consumers turned their gloomiest in over a decade and as uncertainty persisted over plans for the next round of President Donald Trump’s tariffs, set to be unveiled on April 2.
The S&P 500 and Nasdaq Composite indexes both closed slightly higher after fluctuating, with the Dow Jones Industrial Average adding just 4.18 points. Nvidia (NVDA-0.30%) stock fell 0.6%, while Tesla (TSLA+2.96%) eked out a 3.5% gain even after its European unit sales and market share dropped again last month.
GameStop (GME-0.98%) jumped more than 5% in postmarket trading after it amended its investment policy to include Bitcoin. The company’s fiscal-fourth quarter earnings also topped expectations.
Consumer confidence cratered in March, with the index’s future expectations gauge plunging 9.6 points to 65.2, the lowest reading in 12 years. A reading of 80 or below is a recession signal, according to the the Conference Board, which conducts the survey. The headline number also fell by more than expected, and new-home sales data also fell short of estimates.
The drop in the consumer confidence “index shows the new administration’s plans for tariffs and spending cuts are going down like a lead balloon with households,” Pantheon Macroeconomics economist Sam Tombs said.
Stocks of consumption-related companies including UPS (UPS-4.95%), Dollar Tree (DLTR-4.19%) and Target (TGT-2.98%) declined on Tuesday. Dollar Tree reports earnings before the market opens on Wednesday morning.
Markets rose Monday after Trump said reciprocal duties may stop short of his pledge to equalize with levels charged by foreign countries on U.S. goods. The administration may also delay duties on particular types of products.
The tariffs are still set to give the market a negative surprise, Goldman Sachs (GS+0.86%) economist Alec Phillips wrote in a note to clients.
Trump administration officials have said initial duties are meant as a basis for talks — which incentivizes them to set high rates, Phillips said. A recent survey shows market participants expect an initial 9 percent reciprocal tariff rate, but it may be double that level, he wrote.
And despite the lowered pitch of Trump’s rhetoric, the new duties are likely to cover almost all of U.S. trade, Phillips said. The president’s plans to add extra tariffs on buyers of Venezuelan oil add complications, as do the possible inclusion of value added taxes (VATs) and currency undervaluations in the calculations.
Stocks on the move
Stocks active Tuesday included Trump Media, which jumped 8.9% after it announced a tie-up with Crypto.com to start exchange-traded funds (ETFs). Additionally, Trump family-backed World Liberty Financial said it plans to issue a stablecoin.
Boeing’s (BA+0.96%) stock gained 0.9% after the Wall Street Journal reported that the planemaker is seeking to withdraw its earlier agreement to plead guilty in a criminal case that alleged it deceived regulators before two fatal crashes of its 737 MAX jets.
It was a bad day for Chinese EV makers, with Xiaomi (XIACF-0.87%) falling o.7% in U.S. trading after saying it sold 800 million new shares for about $5.5 billion to fund its expansion plans. BYD (BYDDY-5.13%) was unable to sustain Monday’s post-earnings gains, with its ADRs dropping 5.2%.
Decliners also included 23andMe (ME-12.33%), which fell 11%, adding to Monday’s 59% plunge following its bankruptcy filing.
Carvana (CVNA+3.28%) jumped 3.8% after Morgan Stanley (MS+0.62%) analyst Adam Jonas increased his recommendation on the stock to buy from hold and bumped his price target to $280 from $260, Barron’s reported. Mobileye Global (MBLY+8.62%) gained 8.7% after it announced a tie-up with Volkswagen (VWAGY+0.58%) on automated-driving technology.