US STOCKS-Wall Street tumbles; weighed by software, financials amid revived global tariff angst

Wall Street stocks tumbled on ‌Monday, ​led by losses in software and financial shares, as markets were once again plunged into the fog of tariff uncertainty following Friday's Supreme Court ruling against U.S. President Donald Trump's sweeping levies on imported goods, which prompted a fresh round of trade threats from the president. A broad, decisive selloff sent all three ‌major U.S. stock indexes sharply lower as risk appetite was dampened by a return to Trump's erratic statements on trade policy, which fueled much of the market volatility during the first year of the president's second term.

Financial stocks were off 3.3%, while software-related firms slid 4.0% amid ongoing AI disruption fears. "Obviously, the extra layer of uncertainty that comes from the Supreme Court ruling and what trade policy looks like now isn't helping," said Ross Mayfield, ‌investment strategy analyst at Baird in Louisville, Kentucky. "But based on the stocks making moves and the sectors under pressure, this looks like a resumption of the AI disruption selloff."

On Friday, the top court in ‌the nation issued a 6-3 ruling that Trump overstepped his presidential authority by enacting reciprocal tariffs under an economic emergency law, a ruling which provoked condemnation from the president, who threatened a 15% temporary tariff on all imports, despite having reached trade agreements with many of the United States' trading partners. Gold prices, benefiting from a flight to safety, surged 2.1%.

"This adds a level of uncertainty because it calls into question the trade deals that have been made," Mayfield added. "The market can take some solace in the fact ⁠that it seems unlikely ​that the broad effective tariff rate is going ⁠to be higher than it was before, but it's going to be messier and less certain in the near term." A powerful winter storm buried much of the United States under more than 15 inches of snow and paralyzed travel in the Northeast. At ⁠tri-state area airports, 89% to 98% of all flights were canceled, according to flightaware.com. Airlines and travel/leisure-related stocks tumbled 3.7% and 4.0%, respectively. Dow Transports were down 2.9%.

With only 77 of the companies in the S&P 500 yet to post results, ​fourth-quarter earnings season has neared the finish line, a smattering of high-profile companies are expected to report this week, most notably vanguard artificial intelligence chipmaker Nvidia due on Wednesday. Home improvement rivals Home ⁠Depot and Lowe's are also on the docket, which is rounded out by Salesforce and Universal Health Services. Of the companies that have reported, 73% have beaten expectations, and analysts now expect aggregate year-on-year S&P 500 earnings growth of 13.9%, significantly higher than the 8.9% forecast as ⁠of ​January 1, according to LSEG data.

The Dow Jones Industrial Average fell 778.88 points, or 1.57%, to 48,847.09, the S&P 500 lost 74.52 points, or 1.08%, to 6,834.99 and the Nasdaq Composite lost 269.15 points, or 1.18%, to 22,616.92. Among the 11 major sectors of the S&P 500, financials were down the most, while consumer staples enjoyed the largest percentage gain.

The healthcare index advanced 1.0%, boosted by a 4.0% gain in Eli ⁠Lilly after rival Novo Nordisk's obesity drug CagriSema underperformed Eli Lilly's drug Zepbound in a head-to-head trial. Among other movers, Domino's Pizza climbed 4.4% after the fast-food chain's fourth-quarter same-store sales beat Wall Street estimates.

PayPal jumped ⁠5.8% after Bloomberg News reported that the payments firm ⁠is attracting takeover interest. Declining issues outnumbered advancers by a 2.3-to-1 ratio on the NYSE. There were 342 new highs and 173 new lows on the NYSE.

On the Nasdaq, 1,385 stocks rose and 3,258 fell as declining issues outnumbered advancers by a 2.35-to-1 ratio. The S&P 500 posted 38 new 52-week highs and ‌16 new lows while the Nasdaq Composite ‌recorded 65 new highs and 235 new lows.