Wall Street Recovers After Trump Tariff Sell-Off/ Newslooks/ WASHINGTON/ J. Mansour/ Morning Edition/ U.S. markets bounced back Monday after last week’s steep losses driven by Trump’s tariffs and weak job data. Investors gained confidence as companies like Wayfair and Tyson Foods reported strong earnings. The Fed may cut interest rates in September amid rising economic concerns.
Wall Street Quick Looks
- S&P 500 rises 0.8%, Dow gains 310 points
- Nasdaq leads with 1.2% rally amid rebound
- Trump’s tariffs and weak jobs data triggered Friday sell-off
- Wayfair jumps 12.3% on strong earnings surprise
- Tyson Foods climbs 3.8% after beating profit expectations
- On Semiconductor drops 7.1% despite stabilization signs
- Fed may cut rates in September to stimulate economy
- Treasury yields mixed amid rate cut speculation
- Boeing slips after 3,200 workers launch strike
- Tesla rises 2.5% after Musk awarded massive stock package
Deep Look: U.S. Stock Market Rebounds After Tariff Fears, Weak Jobs Report
NEW YORK (AP) — After enduring its worst weekly performance since April, Wall Street bounced back Monday as key U.S. stock indexes recovered roughly half of their steep Friday losses. Investor sentiment improved as earnings reports from major companies offered a boost, even while concerns about tariffs, job data, and interest rates continued to linger.
The S&P 500 rose 0.8%, the Dow Jones Industrial Average climbed 310 points (0.7%), and the Nasdaq Composite gained 1.2% in early trading. The rebound followed a sharp market pullback triggered by a disappointing jobs report and economic uncertainty driven by President Donald Trump’s tariff policies.
Corporate Earnings Offer Support
Several major companies helped lift market sentiment:
- Wayfair surged 12.3% after the online home furnishings retailer reported spring profits and revenue that exceeded analyst expectations, citing accelerating growth.
- Tyson Foods added 3.8%, after the food giant behind Jimmy Dean and Hillshire Farms brands posted a better-than-expected quarterly profit.
- On Semiconductor, however, dropped 7.1% after delivering flat results that merely met expectations. The company reported signs of “stabilization” in industrial and automotive sectors, but investors expected more.
With stock prices having surged from April lows, Wall Street is now demanding strong earnings performance to justify lofty valuations. Analysts remain cautious as volatility continues to threaten the markets.
Trump’s Tariffs Spark Concerns
Last week’s steep losses were largely attributed to concerns over Trump’s new round of tariffs, which many economists believe could dampen economic growth. Compounding fears, Friday’s jobs report revealed a significant slowdown in hiring, with the unemployment rate rising to 4.2%.
Trump responded by firing the official in charge of labor statistics and renewed his criticism of the Federal Reserve, pressuring the central bank to cut interest rates to stimulate growth. While the Fed has held rates steady for much of the year to combat inflation, recent economic softness has raised the odds of a rate cut in September.
Markets now anticipate the Fed may shift course to inject new life into the economy, although the central bank remains cautious due to inflation risks. Trump’s tariffs could add upward pressure on prices, making the Fed’s job even more complex.
Treasury Yields Reflect Mixed Outlook
Bond markets reflected the uncertainty. The 10-year Treasury yield fell to 4.21%, down from 4.23% on Friday, signaling some investor flight to safety. Meanwhile, the two-year yield, more closely tied to Fed policy expectations, nudged slightly higher to 3.70% from 3.69%.
The bond market continues to flash mixed signals as traders weigh the probability of near-term Fed intervention versus longer-term inflation risks.
Upcoming Market Movers
This week may be quieter in terms of economic news, but corporate earnings will remain a key focus. Investors are looking ahead to results from The Walt Disney Co., McDonald’s, and Caterpillar, among others, to assess consumer strength and business confidence.
Meanwhile, broader indicators of U.S. business activity are expected to provide more clues about the health of the economy heading into fall.
Labor Disruptions at Boeing
One notable drag on the market Monday came from Boeing, which slipped 0.8% following a worker strike. Approximately 3,200 Boeing employees in the Midwest walked off the job after rejecting a revised four-year labor agreement that included a 20% wage increase. The strike affects production of fighter jets and adds pressure to the already troubled aerospace manufacturer.
Tesla Reignites Optimism
Tesla shares rose 2.5% after awarding CEO Elon Musk 96 million restricted stock units worth around $29 billion. The award could ease investor fears about Musk leaving the company, especially after a judge previously invalidated a large portion of his pay. The renewed compensation plan signals Tesla’s continued commitment to retaining its high-profile leader.
Berkshire Hathaway Disappoints
Shares of Berkshire Hathaway dropped 3.2% after the conglomerate reported second-quarter profits that were less than half the level seen a year ago. A major factor was a write-down in the value of its investment in Kraft Heinz, highlighting vulnerability in parts of Warren Buffett’s portfolio.
Global Markets Mixed
Markets abroad showed mixed signals:
- South Korea’s Kospi rose 0.9%
- France’s CAC 40 climbed 1%
- Japan’s Nikkei 225 fell 1.2%, making it a regional outlier
Despite uncertainty, investors globally appear to be cautiously optimistic—at least for now.
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