There was a slight rise in U.S. stock futures early Tuesday after the steep sell-off in the last trading day. Investors were apprehensive as they waited for the imposition of the tariffs President Donald Trump had announced on Canada and Mexico. That was the day the extra import taxes were to take effect, which added to market volatility.
Futures contracts tied to the Dow Jones Industrial Average rose by 20 points, a slim gain of 0.04%. S&P 500 futures rose 0.1%, and Nasdaq 100 futures increased by 0.18%, indicating some stabilization following Monday’s decline.
On Monday’s normal trading day, Wall Street saw major losses. The S&P 500 had its biggest one-day drop since December, falling 1.76%. The Dow Jones Industrial Average fell 649.67 points, or 1.48%, and the tech-heavy Nasdaq Composite fell the hardest, falling 2.64%.
Initially, stocks had been trading higher throughout the day. However, the markets turned sharply lower after President Trump reaffirmed that the U.S. would impose a 25% tariff on goods imported from Canada and Mexico. He made it clear that there was “no room left” for negotiations with the two neighboring countries, reinforcing a hardline stance on trade. Additionally, Trump announced a fresh round of 10% tariffs on Chinese goods, further adding to global trade tensions.
The technology industry suffered most of Monday’s decline. Nvidia stock fell by almost 9%, and semiconductor titan Broadcom dropped 6%. Investors, fleeing to defensive shares, turned their attention to consumer staples and healthcare. The consumer staples group managed to rise 0.6%, and healthcare stocks rose about 0.4%.
The overall market decline put the S&P 500 into negative territory for the year. Horizon Investments’ Chief Investment Officer Scott Ladner doubted a quick rebound in the market. “We don’t think the market is going a whole lot of somewhere fast,” he said to CNBC. “We are at a point where sentiment is really in the toilet, and that means getting reversals out of this is probably going to be a bit of a slog.”
Beneath the turbulence in the markets, Ladner noted that the U.S. economy was actually still fundamentally healthy. Firms were continuing to report earnings gains in the range of 10% to 15%, at least partially staving off widespread fears of economic recession. “We’re not going into recession. We’re not even in an earnings recession,” he observed. “There’s really not much out there today that we can see which should really significantly dent corporate earnings power. Our medium-term perspective is still really positive.
In the near term, market participants looked forward to comments from New York Federal Reserve President John Williams, who would speak later on Tuesday. His words may offer more insight into the central bank’s economic projections and possible policy moves.
In the meantime, earnings season was wrapping up, with major reports from Best Buy, AutoZone, Target, and CrowdStrike due out. Those reports would offer further metrics on consumer spending patterns and company attitudes in the face of persistent economic uncertainty.
In a significant move in the technology space, CoreWeave, which is a cloud computing firm dealing in Nvidia graphics processing units (GPUs), went public on Monday with its initial public offering (IPO) filing. CoreWeave’s offerings have picked up speed, especially in the wake of artificial intelligence programs after OpenAI introduced ChatGPT. CoreWeave picked the ticker symbol “CRWV” when it listed on Nasdaq.
CoreWeave brought in $1.92 billion in revenue last year, 62% of which was from Microsoft. The IPO news from the company came as part of a larger market sell-off, with Nvidia’s stock plummeting almost 9%, wiping out $265 billion in market capitalization. The semiconductor industry’s decline was mostly due to worries about the looming tariffs on Canadian and Mexican imports, fueling fears of supply chain disruptions.
A number of stocks made significant movements in after-hours trading on Monday. Software company GitLab saw its shares increase 4% after delivering more-than-anticipated earnings. The firm recorded an adjusted income of 33 cents per share during the fourth quarter, above expectations of 23 cents. Sales also reported robustly at $211 million, above the estimated $206 million.
Cloud software firm Okta saw its stock jump sharply by 15% after it reported a beat on earnings. The company made 78 cents per share on $682 million in revenue, beating Wall Street estimates of 74 cents per share and $670 million in revenue.
AST SpaceMobile, which produces satellites, also experienced a post-market gain, up 2%. The firm delivered a tighter-than-forecast fourth-quarter loss, reporting a deficit of 18 cents a share as opposed to the estimated 19 cents. Nevertheless, its $1.9 million revenue missed analysts’ forecasts of $2.4 million, cooling investor excitement.
Investors remained cautious during the week’s volatile market, keeping a close watch on corporate earnings, economic reports, and any fresh White House announcements on trade policy. Traders braced for more swings in the coming days as volatility was expected to persist.
