Dow Jones slumps over 300 points as financials weigh; Nasdaq hits record
U.S. Treasury yields climbed and the Dow Jones Industrial Average fell on Tuesday after Treasury Secretary Scott Bessent initiated the formal selection process for a new Federal Reserve chair, while June inflation data met expectations but fueled tariff concerns.
The Dow slid 313 points (0.7%) as financial stocks slumped despite strong bank earnings, while the Nasdaq Composite rose 0.6% to a record high, lifted by semiconductor giant Nvidia. The S&P 500 ended flat after touching an intraday record.
Key Market Movements
| Index/Asset | Change | Details |
|---|---|---|
| Dow Jones Industrial | -0.7% | Led by financial sector losses |
| Nasdaq Composite | +0.6% | Boosted by Nvidia (+4%) |
| S&P 500 | Flat | Eased from earlier record high |
| 10-Year Treasury Yield | +8 bps | Rose to 4.49% |
| Citigroup Stock | +1% | Topped earnings estimates |
Inflation and Trade Pressures
June’s Consumer Price Index (CPI) showed annual inflation rose to 2.7% from May’s 2.4%, matching forecasts but intensifying worries about the impact of U.S. tariffs. Core CPI (excluding food/energy) grew 2.9% year-over-year.
Table: June Inflation Snapshot
| Metric | Value (YoY) | Monthly Change | Vs. Expectations |
|---|---|---|---|
| Headline CPI | 2.7% | +0.3% | Matched |
| Core CPI | 2.9% | +0.2% | Slight miss (0.3% est.) |
“Trump’s tariffs pushed up consumer prices in June,” said Matthew Ryan of Ebuy, noting August’s planned 30% EU/Mexico tariffs could worsen inflation.
Sector Highlights
Financials:
- JPMorgan and Wells Fargo beat Q2 profit estimates, but shares fell 1% and 4% respectively on weak guidance.
- BlackRock tumbled 6% despite becoming the first $12 trillion asset manager; revenue missed estimates amid fund outflows.
- Citigroup gained 1% after topping earnings forecasts.
Technology:
- Nvidia surged 4% after securing U.S. approval to resume H20 chip sales in China.
Trade Developments:
- The U.S. struck a tariff deal with Indonesia: 19% on Indonesian goods vs. 0% for U.S. exports.
- President Trump’s July 7 threat of 32% tariffs on Indonesia was averted.
Global Markets
European shares fell for a third session (Stoxx 600: -0.4%), pressured by U.S. inflation data and trade tensions. Sweden’s Ericsson slid 7.7% as tariffs hit margins, while U.K. builder Barratt Redrow plunged 9.4% on missed targets.
Earnings and Outlook
Q2 earnings season faces low expectations, with S&P 500 profits forecast to grow just 4.3% year-over-year—the slowest pace since 2023.
“The Fed chair search adds uncertainty amid sticky inflation,” said Skyler Weinand of Regan Capital. “A tariff-driven reckoning is likely ahead.”