Stocks Retreat Amidst Economic Worries, Nvidia Caution

US stocks experienced a decline on Tuesday as investors grappled with disappointing consumer confidence data and braced for Nvidia’s crucial earnings report later in the week. The Dow Jones Industrial Average, S&P 500, and Nasdaq Composite all registered losses, reflecting growing market unease.

Consumer confidence in the US deteriorated for the third consecutive month in February, according to The Conference Board. The consumer confidence index fell significantly, marking the largest monthly decline since August 2021. This drop signals increasing concerns among American households about the potential impact of tariffs and inflation on the economy.

Market sentiment was also affected by uncertainty surrounding Nvidia’s upcoming earnings. Investors are evaluating the implications of substantial AI spending by major tech companies, with Nvidia’s results serving as a key indicator of the sector’s health.

Trade policy developments further contributed to market anxieties. The administration’s statements regarding potential tariffs on Canada and Mexico raised concerns about escalating trade tensions. Coupled with recent soft economic data and ongoing political uncertainty, these trade-related risks dampened risk appetite.

A report suggesting the White House aims to strengthen export controls on semiconductor technology to China, particularly Nvidia chips, added to the negative sentiment. This news, following calls for increased scrutiny of Chinese investments in US sectors, heightened concerns about renewed trade friction with China. Shares of Nvidia and Intel both declined following the report.

Individual stock movements reflected the broader market concerns. Hims & Hers shares fell sharply after the company warned about potentially halting sales of a popular weight-loss drug. Zoom Communications also saw its stock price decline after issuing revenue guidance that fell short of analysts’ expectations.

Gold prices, while slightly lower, remained near recent highs, supported by safe-haven demand amid trade and economic uncertainties. The metal had earlier reached a new record high following the administration’s tariff signals.

Overall, the combination of weak consumer confidence, Nvidia’s looming earnings, trade policy concerns, and sector-specific news contributed to the downturn in US stock markets.