After securing a new all-time high on Monday, the S&P 500 ETF (SPY) sank lower on Tuesday morning. The Nasdaq 100 ETF (QQQ) followed suit, although both ETFs were able to stage recoveries from the lows.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
- Make smarter investment decisions with TipRanks' Smart Investor Picks, delivered to your inbox every week.
The morning’s headlines began with the State Department announcing that the U.S. would withdraw from the United Nations Educational, Scientific and Cultural Organization (UNESCO), effective December 31.
“President Trump has decided to withdraw the United States from UNESCO — which supports woke, divisive cultural and social causes that are totally out-of-step with the common-sense policies that Americans voted for in November,” White House deputy spokesperson Anna Kelly told the New York Post. Other reasons include the group’s pro-Palestine and pro-China positions.
Afterward, Treasury Secretary Scott Bessent said that the U.S. would likely extend China’s tariff deadline pause of August 12 when trade officials from both sides meet next week. He added that U.S.-China trade has “kind of settled in at a good level” and that he expects the meeting to be fruitful.
On the same side of the world, Trump has announced a trade deal with the Philippines. The U.S. will place a 19% tariff, down from 20%, on the group of islands. In return, the Philippines will tariff imported U.S. goods at 0%. Both sides have agreed to collaborate on military policies. The U.S. had a $4.9 billion trade deficit with the Philippines in 2024.
Meanwhile, Trump is considering Representative Marjorie Taylor Greene’s “No Tax on Home Sales Act.” As the name implies, the bill would eliminate the federal capital gains tax on primary residence home sales. “If the Fed would lower the rates, we wouldn’t even have to do that,” Trump said at the White House on Tuesday. “But we are thinking about no tax on capital gains on houses.”
While Trump has advocated for a 3% reduction to the federal funds rate, he isn’t considering firing Fed Chair Jerome Powell. “I think he’s done a bad job, but he’s going to be out pretty soon anyway,” said Trump, explaining that it would be “unlikely” that he fires Powell before his term expires in May 2026.
The S&P 500 (SPX) finished with a 0.06% gain while the Nasdaq 100 (NDX) fell by 0.50%.
