U.S. stock markets hovered on a flat line Tuesday morning as market uncertainty continues to loom over investors. Ongoing tariff negotiations, mixed economic signals, and unclear global trade prospects have all contributed to cautious trading across major financial markets.
S&P 500 and Nasdaq Stall Amid Cautious Sentiment
The S&P 500 opened little changed, following a modest gain the previous day that added to its strong May performance. As of 9:35 a.m. Eastern, the index was within 3.4% of its all-time high, but showed no clear momentum. Similarly, the Nasdaq Composite held steady, reflecting widespread investor hesitation. Meanwhile, the Dow Jones Industrial Average edged up just 30 points, or 0.1%.
This muted movement is driven by market uncertainty surrounding President Donald Trump’s tariff policies, which have created a stop-start cycle of speculation and reaction across sectors.
Dollar General Soars on Strong Forecasts
One of the rare bright spots was Dollar General (NYSE:DG), which surged 12.9% after posting better-than-expected earnings and revenue for the year’s first quarter. The discount retailer also lifted its full-year guidance, even as it warned that future results remain clouded by market uncertainty due to evolving trade policies.
Many companies, unlike Dollar General, have chosen to either revise or pull their financial guidance altogether amid unpredictable shifts in tariffs and consumer behavior. Uncertainty surrounding supply chains and pricing has complicated forecasting for several major players.
Global Growth Forecasts Dip
Adding to the hesitancy, the Organization for Economic Cooperation and Development (OECD) released a revised U.S. economic growth forecast on Tuesday, trimming it to 1.6% for 2025, down from 2.8% the previous year. The reduction signals the impact of trade friction, slowing demand, and geopolitical tension.
While consumer sentiment has been dampened, broader economic fundamentals remain somewhat resilient. Inflation remains tame, and unemployment levels have stayed relatively low, though manufacturers have begun to report negative effects from disrupted supply chains.
Job Market in Focus
A new jobs report due later Tuesday is expected to shed light on how many job openings were posted at the end of April. That data will be followed by the U.S. Department of Labor’s more significant employment report on Friday, which economists believe will show a slowdown in hiring compared to April.
These reports are critical in helping investors gauge how the Federal Reserve might respond in terms of interest rates and how sustainable current employment levels are in an uncertain market environment.
Trade Deal Optimism Still Flickering
Despite the complex economic backdrop, there remains some optimism that President Trump may make headway on trade deals. U.S. officials suggested that the president expects to speak with Chinese leader Xi Jinping this week. However, Chinese officials denied any scheduled communication, adding to the sense of unpredictability.
If progress is made, it could ease market uncertainty and relieve pressure on affected sectors, including technology and manufacturing.
Meta and Constellation Energy Sign Clean Power Deal
Elsewhere, Constellation Energy (NASDAQ:CEG) gained 5.7% after finalizing a 20-year agreement to supply Meta Platforms (NASDAQ:META) with nuclear-generated electricity from its Illinois-based Clinton facility. The deal aligns with Meta’s sustainability goals and demonstrates a growing trend of tech companies investing in cleaner power sources.
Treasury Yields Retreat After Recent Surge
The bond market also reflected market uncertainty, with Treasury yields slightly easing. The 10-year yield slipped to 4.42%, down from 4.46% on Monday. This followed a two-month climb, fueled by concerns over the U.S. debt load and potential tax cuts that could deepen fiscal deficits.
Higher yields increase borrowing costs for households and businesses and can also make equities look less attractive in comparison, thereby adding downward pressure to stock prices.
International Markets Mostly Flat
Overseas, stock markets showed modest moves, with most indexes in Europe and Asia staying relatively flat. A notable exception was Hong Kong’s Hang Seng Index, which climbed 1.5% despite weaker-than-expected manufacturing data from China.
In contrast, South Korean markets were closed for an emergency presidential election, prompted by the removal of Yoon Suk Yeol. The former president now faces charges tied to his abrupt implementation of martial law last December.
As Wall Street navigates a complex mix of trade issues, economic signals, and geopolitical developments, market uncertainty remains the defining theme across global financial markets.
Featured Image – Freepik
