Stock market today: Wall Street slumps as good news for the economy is once again bad for stocks

NEW YORK (AP) — Good news on the U.S. economy is back to being bad for Wall Street, and the stock market slumped Tuesday following better-than-expected reports on the job market and business activity.

The S&P 500 fell 1.1% after giving up an early gain. The Dow Jones Industrial Average dropped 178 points, or 0.4%, while the Nasdaq composite tumbled 1.9%.

Stocks dropped under the weight of rising yields in the bond market, which jumped immediately after the release of the encouraging reports on the economy. One said U.S. employers were advertising more job openings at the end of November than economists expected. The other said activity for finance, retail and other services businesses grew much faster in December than expected.

The strong reports are of course good news for workers looking for jobs and for anyone worried about a possible recession that earlier seemed inevitable to pessimists. But such a solid economy could also keep up pressure on inflation, and it could make the Federal Reserve less likely to deliver the cuts to interest rates that Wall Street loves.

The Fed began cutting its main interest rate in September to give the economy a boost, but it’s hinted a slowdown in easing is coming. The threat of tariffs from President-elect Donald Trump has raised worries about possible upward pressure on inflation, which has stubbornly remained just above the Fed’s 2% target.

Tuesday’s report on U.S. services industries from the Institute for Supply Management also contained discouraging trends on inflation, saying price increases accelerated in December.

Expectations for fewer cuts to interest rates in 2025 had already been building for weeks, which sent longer-term Treasury yields upward. So have worries about other possible Trump policies, such as tax cuts, which could swell the U.S. government’s debt and likewise push yields higher.

Those higher yields make Treasury bonds more attractive to investors who might otherwise buy stocks, which in turn puts downward pressure on stock prices, and the super-safe bonds are paying notably more. The yield on a 10-year Treasury climbed to 4.69% from 4.63% shortly before the release of Tuesday’s reports and from just 4.15% in early December.

High yields can put heavy pressure on stocks seen as the most expensive, which pulls the lens toward Nvidia and other Big Tech stocks that have soared in the frenzy around artificial-intelligence technology.

Nvidia had been on track to set another all-time high in morning trading, after CEO Jensen Huang unveiled a suite of new products and partnerships the night before. He talked up the potential for AI technology in robotics, among other opportunities for big growth.

But after Tuesday morning's economic reports, which hit the market after its first half hour of trading, Nvidia swung to a loss of 6.2% and became the heaviest weight on the S&P 500. Losses for Amazon, Tesla, Apple and Microsoft were the next-strongest forces dragging the index lower.

Now that worries from the summer about a potentially slowing U.S. economy have abated and the 10-year Treasury yield is firmly above 4.50%, “we believe the market is shifting into a ‘good news is bad news’ environment again,” according to Bank of America strategists led by Ohsung Kwon.

That raises the stakes for Friday’s coming update on the U.S. job market, which economists expect will show a slowdown in overall hiring. They’re looking for growth of 156,500 jobs in December, according to FactSet.

A “Goldilocks” reading for the U.S. stock market that would be solid but not too strong for the Fed would likely be in the 125,000 to 175,000 range, along with an unemployment rate of 4.2%, according to Bank of America.

Helping to keep Tuesday’s losses for U.S. stock indexes in check was Cintas, which rose 2% after making public its offer to buy its smaller rival, UniFirst, for $275 per share in cash.

Cintas said it first made that offer in November but has been unable to get UniFirst’s board to meet. UniFirst had rejected an earlier offer of $255 per share, said Cintas, which provides uniforms, restroom supplies, fire extinguishers and other products to businesses.

UniFirst jumped 20.9% to $204.69, below Cintas’ offer price.

Elsewhere on Wall Street, Shutterstock and Getty climbed after they announced they were joining to become a $3.7 billion visual content company to provide customers with a broader array of still imagery, video, music, 3D and other media.

Getty Images shareholders will own a slight majority of the combined company. Getty shares jumped 24.1%, while Shutterstock climbed 14.8%.

All told, the S&P 500 fell 66.35 points to 5,909.03. The Dow Jones Industrial Average slipped 178.20 to 42,528.36, and the Nasdaq composite sank 375.30 to 19,489.68.

In stock markets abroad, some notable Chinese companies fell after the U.S. Defense Department added dozens of them to a list of companies it says have ties to China’s military. The announcement caused some of the companies to protest and say they will seek to have the decision reversed.

Added to the list were gaming and technology company Tencent, artificial intelligence firm SenseTime and the world’s biggest battery maker CATL. Tencent’s stock that trades in Hong Kong fell 7.3%.

That helped pull the Hang Seng index down 1.2%, but indexes were stronger elsewhere in China and across much of Asia and Europe.

AP Business Writers Yuri Kageyama and Matt Ott contributed.

Traders work on the floor at the New York Stock Exchange in New York's Financial District Thursday, Jan. 2, 2025. (AP Photo/Seth Wenig)

Stock price board is seen after a ceremony marking the start of this year's trading Tokyo Stock Exchange Monday, Jan. 6, 2025, in Tokyo. (AP Photo/Eugene Hoshiko)

A trader works on the floor at the New York Stock Exchange in New York's Financial District Thursday, Jan. 2, 2025. (AP Photo/Seth Wenig)

Currency traders work near a screen showing the Korea Composite Stock Price Index (KOSPI), top left, and the foreign exchange rate between U.S. dollar and South Korean won, top center, at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Tuesday, Jan. 7, 2025. (AP Photo/Ahn Young-joon)

A currency trader passes by a screen showing the Korea Composite Stock Price Index (KOSPI), left, and the foreign exchange rate between U.S. dollar and South Korean won at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Tuesday, Jan. 7, 2025. (AP Photo/Ahn Young-joon)

A currency trader works near a screen showing the Korea Composite Stock Price Index (KOSPI), left, and the foreign exchange rate between U.S. dollar and South Korean won at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Tuesday, Jan. 7, 2025. (AP Photo/Ahn Young-joon)

President Donald Trump remained defiant Monday as global markets continued plunging after his tariff announcement last week.

Trump has insisted his tariffs are necessary to rebalance global trade and rebuild domestic manufacturing. He's singled out China as “the biggest abuser of them all” and criticized Beijing for increasing its own tariffs in retaliation.

Here's the latest:

Wilmer Escaray left Venezuela in 2007 and enrolled at Miami Dade College, opening his first restaurant six years later.

Today, he has a dozen businesses that hire Venezuelan migrants like he once was, workers who are now terrified by what could be the end of their legal shield from deportation.

Since the start of February, the Trump administration has ended two federal programs that together allowed more 700,000 Venezuelans to live and work legally in the U.S. along with hundreds of thousands of Cubans, Haitians and Nicaraguans.

In the largest Venezuelan community in the United States, people dread what could face them if lawsuits that aim to stop the government fail. It’s all anyone discusses in “Little Venezuela” or “Doralzuela,” a city of 80,000 people surrounded by Miami sprawl, freeways and the Florida Everglades.

▶ Read more about fears in Miami’s ‘Little Venezuela’

The Monday meeting will make Netanyahu the first foreign leader to visit Trump since he unleashed tariffs on countries around the world.

Whether Netanyahu’s visit succeeds in bringing down or eliminating Israel’s tariffs remains to be seen, but how it plays out could set the stage for how other world leaders try to address the new tariffs.

Netanyahu’s office has put the focus of his hastily organized Washington visit on the tariffs, while stressing that the two leaders will discuss major geopolitical issues including the war in Gaza, tensions with Iran, Israel-Turkey ties and the International Criminal Court, which issued an arrest warrant against the Israeli leader last year. Trump in February signed an executive order imposing sanctions on the ICC over its investigations of Israel.

▶ Read more about Trump’s meeting with Netanyahu

The stock market briefly spiked on a report that Kevin Hassett, a top White House economic adviser, said the president was considering a 90-day pause on tariffs.

The supposed remark from Hassett circulated on social media, but no one could pinpoint where it came from even as the market flashed from red to green.

Hassett had spoken to Fox News earlier in the morning, when he was asked about a potential pause. However, he was noncommittal.

“I think the president is going to decide what the president is going to decide,” he said.

▶ Read more updates on the financial markets

Vance’s mother, Beverly Aikins’ on Friday received a 10-year sobriety medallion in the Roosevelt Room at a ceremony with friends and family.

Vance described Aikins’ past drug addiction in his bestselling book “Hillbilly Elegy.”

The cases are likely headed to a Supreme Court showdown on the president’s power over independent agencies.

A divided U.S. Court of Appeals for the District of Columbia Circuit issued the ruling in the lawsuits separately brought by Merit Systems Protection Board member Cathy Harris and National Labor Relations Board member Gwynne Wilcox.

The ruling reverses, at least for now, a judgement from a three-judge panel from the same appellate court.

▶ Read more about Trump and the board members

The dispute over tariffs has caused some fracturing within Trump’s political coalition.

Hedge fund manager Bill Ackman said the president was “launching a global economic war against the whole world at once” and urged him to “call a time out.”

“We are heading for a self-induced, economic nuclear winter,” he wrote on X on Sunday.

Top White House economic adviser Kevin Hassett told Fox News on Monday morning that Ackman should “ease off the rhetoric a little bit.”

Hassett said critics were exaggerating the impact of trade disputes and talk of an “economic nuclear winter” was “completely irresponsible rhetoric.”

The president showed no interest in changing course despite turmoil in global markets.

He said other countries had been “taking advantage of the Good OL’ USA” on international trade.

“Our past ‘leaders’ are to blame for allowing this, and so much else, to happen to our Country,” he wrote on Truth Social. “MAKE AMERICA GREAT AGAIN!”

Trump criticized China for increasing its own tariffs and “not acknowledging my warning for abusing countries not to retaliate.”

On a day when stock markets around the world dropped precipitously, Alabama Republican Party Chairman John Wahl led a celebration of the president whose global tariffs sparked the sell-off.

With no mention of the Wall Street roller coaster and global economic uncertainty, Wahl declared his state GOP’s “Trump Victory Dinner” — and the broader national moment — a triumph. And for anyone who rejects Trump, his agenda and the “America First” army that backs it all, Wahl had an offer: “The Alabama Republican Party will buy them a plane ticket to any country in the world they want to go to.”

Wahl’s audience — an assembly of lobbyists and donors, state lawmakers, local party officials and grassroots activists — laughed, applauded and sometimes roared throughout last week’s gala in downtown Birmingham.

Yet beyond the cheerleading, there were signs of a more cautious optimism and some worried whispers over Trump’s sweeping tariffs, the particulars of his deportation policy and the aggressive slashing by his Department of Government Efficiency.

▶ Read more about Trump’s support in Alabama

This morning, at 11 a.m., World Series Champions, the Los Angeles Dodgers, will visit the White House and meet the president. Later, at 1 p.m., Israel Prime Minister Benjamin Netanyahu will visit the White House and meet with Trump. At 2 p.m., Netanyahu and Trump will participate in a Bilateral Meeting in the Oval Office. At 2:30 p.m., they will hold a joint news conference.

Trump said Sunday that he won’t back down on his sweeping tariffs on imports from most of the world unless countries even out their trade with the U.S.

Speaking to reporters aboard Air Force One, Trump said he didn’t want global markets to fall, but also that he wasn’t concerned about the massive sell-off either, adding, “sometimes you have to take medicine to fix something.”

His comments came as global financial markets appeared on track to continue sharp declines once trading resumes Monday, and after Trump’s aides sought to soothe market concerns by saying more than 50 nations had reached out about launching negotiations to lift the tariffs.

The higher rates are set to be collected beginning Wednesday. Treasury Secretary Scott Bessent said unfair trade practices are not “the kind of thing you can negotiate away in days or weeks.” The United States, he said, must see “what the countries offer and whether it’s believable.”

▶ Read more about the global impact of Trump’s tariffs

Pedestrian are reflected on a brokerage house's window as an electronic board displays shares trading index, in Beijing, Monday, April 7, 2025. (AP Photo/Andy Wong)

Shipping containers are stored at Bensenville intermodal terminal in Franklin Park, Ill., Sunday, April 6, 2025. (AP Photo/Nam Y. Huh)

President Donald Trump arrives at the White House on Marine One, Sunday, April 6, 2025, in Washington. (AP Photo/Manuel Balce Ceneta)