S&P 500 falls marginally Tuesday as tariff volatility subsides

U.S. stocks posted modest losses on Tuesday, as investors analyzed the latest batch of first-quarter earnings reports and enjoyed a recent decline in market turmoil.

The Dow Jones Industrial Average lost 155.83 points, or 0.38%, to close at 40,368.96. The S&P 500 declined 0.17% and ended at 5,396.63, and Nasdaq Composite ticked down 0.05% and settled at 16,823.17. The three averages are coming off back-to-back winning sessions.

Tuesday’s muted moves were in stark contrast to the volatile swings seen in recent sessions. The Cboe Volatility Index (VIX), known as Wall Street’s “fear gauge,” fell to about 30 after hitting a high of around 60 last week.

Bank of America and Citigroup added 3.6% and 1.8%, respectively, after exceeding analyst expectations for the first quarter. Bank stocks as a whole provided upward momentum, with the SPDR S&P Bank ETF (KBE) rising more than 1%.

Other major reports due this week include United Airlines and Netflix. Beyond earnings, Boeing shares slipped more than 2% after Bloomberg reported that Beijing ordered Chinese airlines not to take more of the company’s planes.

Stocks received a tailwind into this week after guidance on Friday from U.S. Customs and Border Protection revealed exemptions from “reciprocal” tariffs for electronic products such as smartphones, computers and semiconductors. Still, comments from President Donald Trump and Commerce Secretary Howard Lutnick on Sunday suggested these exemptions might only be temporary.

Despite recent gains, the three major indexes are still clawing back losses seen in the wake of Trump’s original tariff announcement on April 2. The Dow and Nasdaq have each slid 4.4%, while the S&P 500 has dropped 4.8%.

“The worst-case scenario is off the table,” said Larry Tentarelli, founder of the Blue Chip Daily Trend Report. But, “the problem is we could get a headline at any time and the market goes down 3%.”