Major Indexes Pull Back from Record Highs
U.S. stock markets retreated from their record highs on Friday, July 11, 2025, as investors digested President Donald Trump’s latest tariff announcement targeting Canada. The S&P 500 fell 0.4% to 6,253.94, a day after reaching an all-time high, while the Dow Jones Industrial Average dropped 264 points, or 0.58%, to 44,390.90. The tech-heavy Nasdaq Composite showed more resilience but still declined 0.2% to 20,588.63.
The midday market update shows all three major indexes heading toward their first weekly loss in three weeks, as rising bond yields added further pressure to stocks. The benchmark 10-year Treasury yield jumped to 4.40%, weighing on rate-sensitive sectors.
“The market’s mood shifted dramatically after President Trump announced a 35% tariff on Canadian goods starting August 1,” noted market strategist James Wilson. “This unexpected move has investors reassessing the broader economic impact of escalating trade tensions.”
Trump’s Tariff Announcements Rattle Markets
In a significant development that dominated today’s markets today, President Trump announced plans to impose a 35% tariff on Canadian imports, citing concerns over fentanyl flowing across the border. “If Canada works with me to stop the flow of Fentanyl, we will, perhaps, consider an adjustment to this letter,” Trump stated in a post on Truth Social.
The president further unsettled markets by telling NBC News that he plans to implement blanket tariffs of 15% to 20% on most remaining trade partners, higher than the current 10% standard that investors had grown accustomed to. “We’re just going to say all of the remaining countries are going to pay, whether it’s 20% or 15%. We’ll work that out now,” Trump said.
These announcements come just days after Trump revealed a 50% tariff on imported copper and a 50% tariff on Brazilian goods, which had initially been absorbed by the market with minimal disruption. The escalating trade tensions are now causing investors to reassess the economic outlook.
Notable Stock Movers
Despite the broader market decline, several stocks made significant moves today:
Delta Air Lines (DAL) continued its upward trajectory, gaining 11% after the airline reinstated its 2025 profit outlook following strong second-quarter results. The company reported earnings of $2.10 per share on revenue of $15.5 billion, exceeding analyst expectations. CEO Ed Bastian expressed confidence in the business, projecting full-year earnings of $5.25 to $6.25 per share.
MP Materials (MP) soared over 47% after announcing that the Defense Department would purchase $400 million in preferred stock, highlighting the strategic importance of rare earth minerals in the current geopolitical climate.
WK Kellogg (WK) surged 30% following news that Italian chocolate maker Ferrero agreed to acquire the breakfast food company for $23 per share in cash, valuing the Froot Loops maker at approximately $3.1 billion.
Meanwhile, banking stocks faced pressure ahead of next week’s earnings season kickoff. JPMorgan Chase (JPM) led banks lower, falling about 1%, while Citigroup (C) also lost approximately 1% and Wells Fargo (WFC) dipped 0.6%.
Upcoming Earnings Season and Market Events
The second-quarter earnings season is set to begin in earnest next week, with major financial institutions leading the way. JPMorgan Chase, Citigroup, and Wells Fargo are scheduled to report on Monday, July 14, followed by Bank of America (BAC), Goldman Sachs (GS), and Morgan Stanley (MS) later in the week.
Analysts at FactSet estimate a year-over-year earnings growth rate of 5.0% for S&P 500 companies in the second quarter, which would mark the lowest earnings growth reported by the index since Q4 2023. This modest growth projection comes amid concerns about the impact of rising trade tensions on corporate profits.
Other notable companies reporting next week include Johnson & Johnson (JNJ), PepsiCo (PEP), and Netflix (NFLX), with the latter’s results eagerly anticipated by investors watching for signs of continued subscriber growth in the competitive streaming landscape.
Economic Outlook and Market Sentiment
Market sentiment has shifted from the optimism that drove stocks to record highs earlier this week. The resilience that allowed markets to shrug off initial tariff announcements appears to be waning as the scope and scale of trade restrictions expand.
“It is wild to think that valuations are above where we started the year considering all the uncertainties with tariffs, and we now have a new deadline,” said Mike Dickson, head of research and quantitative strategies at Horizon Investment. “The market’s been extremely desensitized to all of this back and forth, and I think for good reason.”
However, Drew Pettit, Citi’s U.S. equity strategy director, warned that “the economy needs to continue to stay resilient for the rally to be sustainable,” suggesting that investors should closely monitor upcoming economic data for signs of weakness.
Looking Ahead
As markets navigate the midday update, investors are closely watching for any further developments in trade policy, particularly regarding the European Union, where an update from Trump is expected but has not yet materialized. The president’s comment that “the tariffs have been very well-received” and his reference to the stock market hitting new highs yesterday suggest he may not be deterred by today’s market pullback.
With earnings season about to begin and trade tensions escalating, market volatility could increase in the coming weeks. Investors will be paying particular attention to company guidance regarding the potential impact of tariffs on future profitability.
The market’s ability to weather these challenges will depend largely on continued strength in corporate earnings and economic data. As one analyst put it, “The resilience we’ve seen so far this year is being tested, but the fundamental story of AI-driven growth and consumer strength remains intact for now.”
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.