Dow Drops as Trade Tensions Rise
The Dow Jones Industrial Average dropped nearly 200 points (0.4%) on Monday amid renewed U.S.-China trade tensions. Despite the overall decline, Nvidia (NVDA) and UnitedHealth (UNH) posted gains. UnitedHealth rose nearly 2%, though it’s still down around 39% for the year. Nvidia also added close to 1%.
3M (MMM) led the losses on the Dow, falling almost 2%, followed by Salesforce (CRM) and Sherwin-Williams (SHW), which both declined over 1%.
Nasdaq Holds Up Better
The Nasdaq Composite performed better than the other indexes, dipping just 0.1%. It remains above key moving averages. Top gainers included Grail (GRAL), which jumped over 7%, and Zscaler (ZS), up nearly 5%. However, CDW (CDW) and Atlassian (TEAM) fell around 3% and 2%, respectively.
S&P 500 Falls as Energy Leads, Real Estate Lags
The S&P 500 slipped 0.3%, with energy stocks leading and real estate along with consumer discretionary sectors underperforming. Broadcom (AVGO) was among the best performers, gaining nearly 3%, while First Solar (FSLR) and Ford (F) each dropped about 4%.
Newmont (NEM), a gold miner, also stood out with a 6% rise.
Small Caps & Growth Stocks
The Russell 2000 index of small-cap stocks dropped 0.3%, staying below its 200-day moving average. However, growth stocks did better, with the Innovator IBD 50 ETF (FFTY) rising 0.3% and now showing over 4% gains for 2025.
Bessent Reassures on U.S. Debt
Treasury Secretary Scott Bessent tried to ease concerns over the growing U.S. national debt. He stated on Face the Nation that the U.S. will never default, dismissing JPMorgan CEO Jamie Dimon’s warnings about a potential bond market crisis. Bessent added that the debt reduction plan is set to unfold over the next four years.
U.S.-China Trade Conflict Intensifies
Tensions between the U.S. and China worsened after President Trump accused Beijing of breaking the trade truce. In response, China criticized U.S. tech export controls and threatened to take “resolute and forceful measures.” China is also displeased about visa restrictions for its students and rare-earth export issues.
The White House confirmed that Trump and Chinese President Xi Jinping are expected to talk later this week.
Steel Stocks Surge on Trump’s New Tariffs
Steel stocks rallied after President Trump announced he will double tariffs on steel imports from 25% to 50%, aiming to protect the U.S. steel industry. This follows the approval of a deal between Nippon Steel and U.S. Steel (X).
- Nucor surged nearly 10%, breaking its 50-day moving average.
- Cleveland-Cliffs (CLF) skyrocketed 25%, though it’s still below key levels.
- Steel Dynamics (STLD) tested a buy point at 139.65, ending up nearly 10% despite having a low IBD Composite Rating of 38/99.
The VanEck Steel ETF (SLX) also jumped 3%.
However, the steel industry still faces long-term challenges. The U.S. imports 25% of the steel it uses annually — around 29 million tons, according to the American Iron and Steel Institute.
