On July 7, 2025, the U.S. stock market opened the week with a downward trend, with the S&P 500 dropping by 0.8%. The cause? A renewed focus on U.S. trade policy, as President Donald Trump announced impending tariffs on key trading partners like South Korea and Japan. According to Trump, if these countries fail to reach a deal by July 9, the U.S. will impose a 25% tariff on their imports starting August 1. Meanwhile, other nations could face tariffs of up to 40%.
The S&P 500 finished the day 0.8% lower, retreating from its all-time closing high set just before the July 4 weekend. The Nasdaq Composite also dropped by 0.9%, while the Dow Jones Industrial Average closed down 0.9%. These declines reflect market unease over the trade war’s potential impact, as the tariff threats seemed to rattle investor sentiment across major U.S. equity indexes.
Tesla (TSLA) took the hardest hit among the S&P 500 stocks, plummeting by 6.8%. The drop came on the back of CEO Elon Musk's controversial announcement that he plans to launch a new political party, the "America Party." This declaration only intensified Musk's ongoing tension with President Trump, who had already suggested that Musk's ideas were "off the rails." Additionally, analysts at William Blair downgraded Tesla’s stock to “market perform” from “outperform,” citing the removal of the $7,500 electric vehicle tax credit under the newly passed budget bill as a major headwind for the company.
Meanwhile, First Solar (FSLR) saw its stock fall by 4.3%, erasing gains from late last week. The company, along with other stocks in the renewable energy sector, had benefited from the final version of the budget bill, which removed a proposed tax on wind and solar projects involving foreign participation. However, the bill retained other provisions that present challenges to the solar industry, including the phasing out of federal tax credits for residential rooftop solar installations.
In the medical sector, Baxter International (BAX) saw a 4.3% drop in share price after the company announced the appointment of a new CEO. Andrew Hider, CEO of Canadian automation firm ATS Corp., was named to take over the reins by September. The announcement of this leadership change led to immediate market concerns, causing a downturn in the stock.
Lululemon Athletica (LULU), the maker of yoga gear and athletic wear, saw its shares drop 4.1%. This decline reversed the gains the company had made last week after President Trump announced a trade deal with Vietnam, where Lululemon has significant manufacturing exposure. The stock also faced headwinds following a lawsuit the company filed against Costco (COST), alleging that the retail giant had infringed on Lululemon’s trademarks by selling clothing that closely resembled its designs.
Not all stocks performed poorly, however. Tractor Supply Co. (TSCO) stood out as one of the top performers, with shares rising 3.9%. Analysts are optimistic about the company’s ability to report higher year-over-year profits, despite concerns over trade uncertainties and restrained consumer spending. Tractor Supply is expected to report a boost in its next earnings report, which is due on July 24.
Shares of DoorDash (DASH) gained 3.4%, following a price target boost from Deutsche Bank analysts. The analysts pointed to DoorDash's growing presence in the U.S. grocery market, with projections for increasing transactions and sales growth driven by higher order values.
Uber Technologies (UBER) saw a 3.3% rise after Wells Fargo analysts raised their price target for the stock. The analysts expressed a positive outlook on Uber’s growth prospects in mobility bookings, as well as its strategic initiatives to expand market presence through lower-priced products and by entering less dense markets.
In summary, Monday’s trading session saw U.S. equities take a hit, largely due to concerns about the escalating trade war. While many stocks struggled, especially those tied to specific sectors like electric vehicles and renewable energy, companies like DoorDash and Uber showed resilience thanks to strong growth projections and a favorable outlook from analysts. Investors are now looking ahead to the next few months, keeping a close eye on trade developments, corporate earnings reports, and shifts in market sentiment.
The next few weeks could be crucial for market performance, with the looming threat of tariffs and the ongoing policy shifts under the current administration. As investors continue to navigate this turbulent landscape, the volatile movements in stocks like Tesla and Lululemon could provide opportunities as well as risks. As always, those with the right information and strategy may find a way to profit from these uncertain times.