U.S. stock indexes closed lower Monday but rebounded from earlier steep losses after President Donald Trump delayed new tariffs on Mexico. Trump granted a one-month pause after Mexico agreed to deploy 10,000 National Guard troops to curb illegal drug trafficking, especially fentanyl.
Over the weekend, Trump had announced 25% tariffs on Mexico and Canada and 10% on China, warning of short-term economic pain. Analysts fear prolonged tariffs could further pressure markets and drive inflation. The Dow Jones fell 122.75 points (0.28%) to 44,421.91, while the S&P 500 lost 45.96 points (0.76%) to 5,994.57, and the Nasdaq dropped 235.49 points (1.2%) to 19,391.96. Defensive sectors like healthcare and consumer staples gained, while tech and consumer discretionary stocks lagged.
Automakers, hit hard by tariff concerns, recouped some losses, with Ford slipping 1.9% and GM dropping 3.2%. The Cboe Volatility Index spiked before settling at 18.6. Meanwhile, AI-driven market disruptions persisted, with Nvidia sliding 2.8% as semiconductor stocks dipped 1.8% following concerns over Chinese AI startup DeepSeek’s breakthrough.
The small-cap Russell 2000 index briefly touched a three-week low before closing down 1.3%. Investors sought safety in bonds and gold, pushing spot gold to a record high. Treasury yields edged lower.
Earnings season continued, with Tyson Foods rising 2.2% after an upbeat sales forecast and IDEXX Laboratories surging 11.1% on strong earnings. Economic data showed U.S. manufacturing expanded for the first time in two years.
Declining stocks outnumbered advancers by a 2.18-to-1 ratio on the NYSE and 2.37-to-1 on the Nasdaq. Trading volume reached 16.34 billion shares, above the 20-day average of 15.57 billion.


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