Both the S&P 500 ETF (SPY) and the Nasdaq 100 ETF (QQQ) closed in negative territory as investors await updates from a high-stakes summit between President Trump and Russian President Vladimir Putin.
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Both leaders have already touched down at the Elmendorf-Richardson military base in Anchorage, Alaska, with discussions underway to end the Russia-Ukraine war. The meeting, initially planned to be a one-on-one event, now consists of three participants from each side. Trump is joined by U.S. Secretary of State Marco Rubio and special envoy Steve Witkoff, while Putin is accompanied by Foreign Minister Sergey Lavrov and foreign policy aide Yury Ushakov.
“All I want to do is set the table for the next meeting, which should happen shortly,” Trump said before taking off to Alaska. Earlier this week, he explained that a second meeting could include Ukrainian President Volodymyr Zelenskyy and other European leaders.
Meanwhile, the market received a shock after the University of Michigan’s preliminary August Index of Consumer Sentiment showed a reading of 58.6, below the expectation for 62.0 and falling from 61.7 in July. If the reading holds, it would mark the first decline following four consecutive months of increases.
“Overall, consumers are no longer bracing for the worst-case scenario for the economy feared in April when reciprocal tariffs were announced and then paused,” said Surveys of Consumers Director Joanne Hsu. “However, consumers continue to expect both inflation and unemployment to deteriorate in the future.”
In addition, consumers now expect year-ahead inflation of 4.9% compared to 4.5% in July. Long-term inflation expectations jumped to 3.9% from 3.4%. July’s elevated Producer Price Index (PPI) and core Consumer Price Index (CPI) add to the evidence that inflation could be mounting a comeback as consumers face higher prices from the Trump administration’s tariffs.
Import prices are also on the rise, signaling that U.S. trading partners aren’t lowering prices in order to offset higher domestic prices. July’s import prices rose by 0.4% month-over-month, ahead of the expectation for prices to remain unchanged. Import prices fell by 0.2% year-over-year.
On the tariff front, Trump said he would announce the rate for semiconductor imports in the coming weeks, adding that it could be as high as 200% or 300%. That’s much higher than the 100% figure he suggested during a White House event with Apple (AAPL) CEO Tim Cook earlier this month.
The S&P 500 (SPX) closed with a 0.29% loss while the Nasdaq 100 (NDX) fell by 0.51%.
