Dow slides nearly 400 points, S&P 500 books back-to-back losses as path on trade deals remains unclear: Live updates

Stocks slipped Tuesday after President Donald Trump’s shaky commentary on global trade deals, dashing hopes that progress will soon be made on the tariff front. Investors also awaited the Federal Reserve’s policy decision.

The Dow Jones Industrial Average lost 389.83 points, or 0.95%, to close at 40,829.00. The S&P 500 shed 0.77% and settled at 5,606.91, and the Nasdaq Composite dipped 0.87% to end at 17,689.66. All three of the major averages posted back-to-back declines.

Shares of Tesla shed 1.8% after the company’s new car sales in Britain and Germany fell to their lowest in more than two years in April, even though demand for electric vehicles grew. Goldman Sachs shares dipped 1.8%, pulling the Dow lower. Tech giants Nvidia and Meta Platforms also declined.

Stocks wavered after Trump met with Canadian Prime Minister Mark Carney on Tuesday afternoon, marking the start of negotiations between the two leaders since since Carney assumed office earlier this year.

Trump during the meeting walked back on promises that trade deals are on the horizon, saying, “We don’t have to sign deals.” His statement contradicts Treasury Secretary Scott Bessent’s comments earlier this week. Bessent told CNBC on Monday that “we’re very close to some deals,” echoing comments Trump made himself on Sunday that agreements could come as early as this week.

Bessent had reiterated this sentiment in testimony to the House appropriations committee on Tuesday, noting: “Approximately 97 or 98% of our trade deficit is with 15 countries. Eighteen percent of the countries are our major trading partners. And I would be surprised that if we don’t have more than 80 or 90% of those wrapped up by the end of the year, and that may be much sooner that.”

To be sure, official trade deals between the U.S. and its trading partners have yet been announced. And while data issued on Monday from the Institute for Supply Management showed stronger-than-anticipated service sector activity in April, concerns around tariffs persisted.

“We’ll probably go down to new lows, even when Trump dials back China to 50%,” billionaire hedge-fund manager Paul Tudor Jones told CNBC on Tuesday. “He’ll dial it back to 50% or 40%, whatever. Even when he does that … it’d be the largest tax increases since the 60s. So you can kind of take 2%, 3% off growth.”

The Fed began its two-day policy meeting on Tuesday, with a decision scheduled for Wednesday. The central bank is expected to keep rates steady, with fed funds futures trading suggesting just a 3.1% chance of easing.

Still, traders will be listening for Fed Chair Jerome Powell’s comments on his economic outlook.

“Despite external pressure to lower rates, the Fed will likely hold strong on the current pause until we see greater clarity on the major economic factors impacting the economy,” said Steve Rick, chief economist at TruStage. “As the impacts of tariffs settle in, we still broadly expect the economy to continue to shift towards a slower pace of growth than in recent months.”