Stock futures began the week in negative territory as investors braced for another round of trade uncertainty. President Donald Trump confirmed Sunday evening that his administration will impose new tariffs on several trading partners starting August 1, ending the 90-day pause initiated in April. Dow futures fell 0.35%, while the S&P 500 and Nasdaq futures dropped 0.4% and 0.5%, respectively.
Crude oil and gold prices also fell, and Treasury yields edged lower as investors sought clarity on trade negotiations and upcoming corporate earnings.
Tariff uncertainty weighs on markets
Over the weekend, President Trump stated he would send letters to “probably 12” countries outlining new tariffs. The U.S. Treasury confirmed that unless trade deals are reached by August 1, tariffs will revert to the levels first announced on April 2, which had initially triggered a sharp market selloff.
Key partners like Japan, the EU, and India are reportedly scrambling to reach preliminary trade deals to avoid full tariff exposure.
While the original deadline was July 9, Commerce Secretary Howard Lutnick clarified that the effective date for tariff hikes would be pushed to August 1. Treasury Secretary Scott Bessent warned that any country failing to negotiate terms would face the full brunt of the “Liberation Day” tariffs.
Market recap: rally paused by political risk
Last week, the Dow Jones Industrial Average rose 2.3%, the S&P 500 gained 1.7%, and the Nasdaq Composite climbed 1.6%, pushing the latter two into record territory. The Russell 2000 surged 3.5%, clearing its 200-day moving average.
Despite last week’s optimism, the potential for renewed trade tensions adds fresh volatility heading into earnings season.
Tesla, tech stocks under pressure
Tesla (TSLA) is back in focus after CEO Elon Musk announced plans to launch a new political entity, the “America Party.” The move follows Musk’s public feud with Trump over the federal budget and a loss of key electric vehicle tax credits. The $7,500 EV credit expires on September 30, while Tesla’s lucrative zero-emission credits have been eliminated effective immediately.
Tesla shares fell 2.6% last week and were trending lower in premarket trading. Meanwhile, competitors Uber (UBER) and Mobileye (MBLY) have surged, with Uber stock breaking out to new highs.
Key earnings and economic events
- Delta Air Lines (DAL) will kick off airline earnings on July 10.
- Taiwan Semiconductor (TSMC) reports sales later this week, offering insight into chip demand across Nvidia, Apple, and Broadcom.
- Federal Reserve minutes from the last FOMC meeting are due Wednesday and may reveal more about the central bank’s rate strategy.
ETFs and sector moves
- Innovator IBD 50 ETF (FFTY): +2.45%
- VanEck Semiconductor ETF (SMH): +1.9%
- ARK Innovation ETF (ARKK): +1.8%
- S&P Metals & Mining ETF (XME): +5.6%
- U.S. Global Jets ETF (JETS): +5.3%
- Financial Select Sector SPDR (XLF): +2.4% (record high)
What investors should do now
With indexes near record levels, investors are advised to:
- Monitor trade headlines closely through July and into August.
- Prepare for earnings season by updating watchlists.
- Avoid chasing extended stocks and instead focus on setups near buy zones like Cadence Design (CDNS), Nextracker (NXT), Shopify (SHOP), and ServiceNow (NOW).
While the market rally remains intact, escalating political and trade developments could spur heightened volatility.
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