The New York stock market took a hit on Monday as markets reopened after the Independence Day holiday. The downturn came after U.S. President Donald Trump released trade letters imposing 25% reciprocal tariffs on both South Korea and Japan.
The S&P 500 and Nasdaq, which had set consecutive record highs on July 2 and 3, fell in tandem with the Dow Jones Industrial Average.
Tesla’s stock plummeted 6.8% in the wake of CEO Elon Musk’s announcement on July 5 about launching a new political party called the America Party. The company’s market value plummeted by over $ 68 billion in a single day.
Trade War Reignites
After setting record highs for two consecutive days before the holiday, the New York stock market reopened lower.
Trump disclosed trade letters for South Korea and Japan, followed by letters for five other nations: Malaysia, Laos, Myanmar, Kazakhstan, and South Africa.
These countries face reciprocal tariffs beginning August 1 if trade agreements aren’t reached.
Laos and Myanmar are set to impose 40% reciprocal tariffs on each other.
Seven of the 15 trade letters Trump plans to send between July 7 and 9 were made public on this day.
As Trump rekindled the trade war, the stock market’s record-breaking run came to an abrupt end.
The Dow Jones Industrial Average closed down 422.17 points (0.94%) at 44,406.36.
The S&P 500 and Nasdaq, after two days of record highs, also declined. The S&P 500 fell 49.37 points (0.79%) to 6,229.98, while the Nasdaq dropped 188.59 points (0.92%) to 20,412.52.
Tesla Sheds $68 Billion in Market Value
Amid the negative reaction to Tesla CEO Musk’s new political party, the Company’s stock price dipped below $300 for the first time in a month.
The stock slid $21.41 (6.79%) to close at $293.94, marking its first close below $300 since June 6.
CNBC reported that the company’s market capitalization plummeted by over $68 billion on Monday alone.
Among Magnificent Seven, Only Amazon Holds Steady
Except for Amazon, which posted a slight gain, all other members of the Magnificent Seven tech giants saw declines.
Nvidia dropped $1.10 (0.69%) to $158.24, while Apple fell $3.60 (1.69%) to $209.95.
Alphabet declined by $2.99 (1.66%) to $177.56, and Microsoft slipped $1.12 (0.22%) to $ 497.72.
Amazon bucked the trend, inching up $0.06 (0.03%) to close at $223.47.
