Wall Street Indexes Look Down as Trump Tariffs and Budget Deficit Bulge Adds to Growing List of Worries

Barry Adams
18 Nov, 2024
New York City

Stock market indexes on Wall Street inched higher as investors awaited major earnings this week. 

The S&P 500 index inched up 0.1% and the Nasdaq Composite advanced 0.3% in the hopes that Walmart, TJX, Lowe's, Nvidia, and Palo Alto Networks will deliver better-than-expected quarterly results. 

Nvidia is scheduled to release its quarterly results on Wednesday, and the artificial intelligence application chip maker's stock declined 2% on a report that the company's chips are overheating in certain server configurations. 

Last week, stock market indexes around the world declined as investors digested the rising possibilities of escalating trade tensions turning into full-blown trade wars. 

U.S. major averages dropped after Fed Chair Jay Powell signaled a lack of urgency for future rate cuts, citing strong economy and labor market conditions. 

In addition, post-U.S. elections rally wavered for two consecutive weeks after the reality of chaotic administration, unhinged presidential leadership, and an extreme tariff policy agenda began to set in. 

Trump's tariffs, tax cuts, and deportation plans are estimated to drive the federal government deficit by an additional $8 trillion over the four-year term, increase annual inflation by as much as 2 percentage points, and contribute to labor shortages in the agriculture, hospitality, and construction industries. 

Stock market indexes in the first quarter of 2025 are likely to face stiff headwinds as the next administration implements its economic agenda. 

In the week ahead, a private survey of the U.S. manufacturing sector is expected to confirm an ongoing contraction, but growth in the service sector is likely to pick up.

In addition, investors are looking forward to the release of housing building permits, starts, and completion data later in the week. 

 

U.S. Indexes and Treasury Yields

The S&P 500 index increased 0.1% to 5,901.02, the Nasdaq Composite rose 0.4% to 18,897.16, and the Russell 2000 index declined 0.2% to 2,329.27. 

The yield on 2-year Treasury notes edged higher to 4.34%, 10-year Treasury notes inched up to 4.48%, and 30-year Treasury bonds decreased to 4.66%.

WTI crude oil increased $0.12 to $67.15 a barrel, and natural gas prices edged up 9 cents to $2.91 a thermal unit.

Gold decreased by $35.41 to $2,597.14 an ounce, and silver increased by $0.58 to $30.83.

The dollar index, which weighs the US currency against a basket of foreign currencies, edged lower to 106.70.