Escalating Trade Tensions Drag Tech Stocks, Surge In Vehicle Sales Lifts Retail Sales

Barry Adams
16 Apr, 2025
New York City

Wall Street indexes lacked direction on Wednesday as investors focused on the fresh batch of corporate results amid elevated tariff turmoil. 

The S&P 500 index decreased 1%, and the Nasdaq Composite declined 2% as investors reacted positively to earnings from Bank of America, Citigroup, Goldman Sachs, United Airlines, and CSX. 

Nvidia came under pressure after the company was restricted from selling its H2O chip to China amid new trade barriers on trade with China set by the Trump administration.

Global investor sentiment has turned cautious following the Trump administration's constant trade policy changes and escalating threats to key allies. 

Investors have soured on the U.S. dollar-denominated assets, driving down the value of the U.S. dollar and pushing the yield on the 10-year U.S. Treasury notes by 50 basis points. 

Japan, China, the UK, and Luxembourg own about $3 trillion of U.S. Treasury notes, and a total of $8.5 trillion worth of U.S. Treasury notes are held by foreign governments or entities, according to the latest data available from the U.S. Department of the Treasury. 

Investors are increasingly considering the possibility of a yield on 10-year Treasury notes surging close to 6.5%, driven by the combined effect of panic selling by foreign investors and a fresh bout of inflation.

 

Commodities, Currencies, Indexes, Yields

The S&P 500 index decreased 1.1% to 5,338.83, the Nasdaq Composite edged down 1.9% to 16,496.05, and the Russell 2000 index was down 0.5% to 1,870.98.

The yield on 2-year Treasury notes edged lower to 3.81%, 10-year Treasury notes decreased to 4.34%, and 30-year Treasury bonds advanced to 4.79%.

WTI crude oil increased $0.68 to $62.01 a barrel, and natural gas prices edged lower by $0.06 to $3.27 a thermal unit.

Gold increased by $56.84 to 3,307.85 an ounce, and silver edged up by $0.41 to $32.80.

The dollar index, which weighs the US currency against a basket of foreign currencies, decreased by 0.60 to 99.62, and it traded at the lowest level since April 2022.

 

U.S. Retail Sales Surged In March

On the economic front, retail and food services sales in March, adjusted for seasonal and calendar effects but not for inflation, jumped 4.6% from a year ago to $734.9 billion. 

On a monthly basis, sales advanced 1.4%, the U.S. Census Bureau reported today. 

Total sales for the January through March period were up 4.1% from the same period a year ago, and the January to February percent change was unrevised from up 0.2%. 

Retail trade sales in March were up 1.4% from February and up 4.6% from last year. 

Motor vehicle and parts dealer sales surged 8.8%, while nonstore retailer sales advanced 4.8% from a year ago, respectively.

 

U.S. Movers 

Bank of America edged up 0.4% to $37.85 after the bank reported better-than-expected quarterly results amid a steady flow of assets and stable deposits. 

Citigroup edged up 0.3% to $63.48 after the bank's quarterly results surpassed market expectations because of higher revenue in its equity and fixed-income trading businesses. 

HP Enterprise Co. decreased 0.4% to $14.90, and activist investor Elliott Management has taken a $1.5 billion stake in the cloud services provider. 

United Airlines soared 6.4% to $14.90, and the international carrier reported strong quarterly results amid rising demand for premium international air travel. 

The airline said it reiterated its annual adjusted earnings per share to range between $11.50 and $13.50, but recession could drive down earnings to between $7.0 and $9.0. 

Nvidia Corp. dropped 6.4% to $104.97, and the advanced semiconductor maker said it plans to take a one-time charge of $5.5 billion after the Trump administration banned the company from selling H2O chips to China.