Wall Street Dips After Trump Tax Bill Passes/ Newslooks/ WASHINGTON/ J. Mansour/ Morning Edition/ U.S. stocks edged lower Thursday as rising debt and Treasury yields spooked investors. A new multitrillion-dollar GOP tax bill stirred fresh concern about the federal deficit. Meanwhile, solar and health care stocks dragged markets further down.
Market Moves Quick Looks
- S&P 500 down 0.3% in early trading Thursday
- Dow Jones slips 101 points; Nasdaq off 0.2%
- 10-year Treasury yield peaks at 4.63% before settling at 4.59%
- House passes Trump-backed tax bill adding trillions to debt
- Investors brace for Senate revisions to legislation
- Clean energy stocks plunge on tax credit rollback provisions
- Health insurers hit by expanded Medicare Advantage audits
- Global markets follow U.S. lead with broad losses
Deep Look: U.S. Stocks Stall as Debt Concerns, Tax Bill Shake Wall Street
NEW YORK — May 22, 2025 — U.S. markets slipped again Thursday, extending a turbulent week as traders continue to digest fears over the federal debt load, rising Treasury yields, and the economic impact of President Donald Trump’s sweeping new tax legislation.
The S&P 500 dropped 0.3% in early trading, while the Dow Jones Industrial Average lost 101 points, or 0.2%, and the Nasdaq composite also slid 0.2%.
Debt Worries Loom Over Capitol Hill Legislation
At the heart of Wall Street’s unease is the House-passed tax-and-spending package — a cornerstone of Trump’s second-term economic agenda. The legislation extends $4.5 trillion in tax cuts from Trump’s first term and introduces new tax breaks, including on tips, overtime, and car loan interest.
Though celebrated by GOP lawmakers as a growth stimulus, the bill has triggered alarm over its potential to add trillions to the national debt. Investors are reacting swiftly: yields on 10-year Treasury notes briefly surged to 4.63%, a sharp climb from 4.01% just weeks ago.
“These yields affect everything from mortgages to business loans,” said one market analyst. “This is the market pricing in higher debt and inflation risk.”
Bond Market Sends Warning Signals
The bond market remains the epicenter of investor anxiety, with sharp swings continuing to roil Wall Street. On Thursday morning, the 10-year Treasury yield cooled slightly to 4.59%, still near its highest level in months.
Higher yields raise borrowing costs across the economy and tend to dampen investor appetite for riskier assets, including stocks.
Clean Energy and Health Care Stocks Slide
Several sectors were hit hard by developments in Washington:
- Solar and renewable energy firms were pummeled after the GOP bill proposed a faster rollback of production tax credits introduced under the Biden administration’s Inflation Reduction Act.
- Sunrun plunged 40%
- Enphase Energy dropped 16.5%
- First Solar lost 4%
- Health insurance providers also declined after the Centers for Medicare & Medicaid Services announced expanded audits of Medicare Advantage plans.
- UnitedHealth Group fell 1.4%
- Humana dropped 3.6%
Global Markets Follow Suit
Investor concerns were not limited to the U.S., as global markets reflected the same cautious sentiment.
- France’s CAC 40 shed 1.1%
- Hong Kong’s Hang Seng dropped 1.2%
- South Korea’s Kospi also lost 1.2%
Broader concerns about U.S. fiscal stability and higher global borrowing costs continue to drive market volatility overseas.
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