U.S. stocks edged lower Tuesday, retreating from record levels as investors assessed headlines around trade and fiscal policy and prepared for the release of key labor market data later this week.
At 09:32 ET (13:32 GMT), the Dow Jones Industrial Average slipped 33 points, or 0.1%, the S&P 500 index fell 16 points, or 0.3%, and the NASDAQ Composite dropped 100 points, or 0.5%.
The S&P 500 and the NASDAQ Composite both recorded fresh closing peaks on Monday, with sentiment boosted by signs of easing trade tensions as well as expectations of Fed rate cuts in the near future.
Trade deals in focus
The announcement of a trade agreement between the U.S. and China last week, coupled with Canada withdrawing its digital services tax on tech companies just hours before it was set to be implemented, have bolstered expectations that trade agreements could be reached before President Trump’s July 9 deadline.
However, a deal with Japan is proving troublesome, and U.S. trade officials under Trump are now pivoting to narrower trade agreements in a bid to secure quick wins ahead of a July 9 deadline, when steep reciprocal tariffs are set to return, the Financial Times reported on Tuesday, citing people familiar with the talks.
The administration is seeking “agreements in principle” on limited issues with select countries to avoid the reimposition of tariffs as high as 50%, the FT report stated.
These phased deals mark a retreat from Trump’s original pledge to strike 90 comprehensive trade agreements during a 90-day pause in tariff enforcement, which began on April 2.
