U.S. stocks were mostly flat an hour after the opening bell, with the Dow Jones Industrial Average up 13 points as investors weighed the latest developments surrounding President Donald Trump’s tax bill.
While the Dow managed to reverse futures losses seen earlier in the day, the S&P 500 hovered just 0.06 percent in the green. Like the benchmark S&P 500 and the blue-chip Dow, the Nasdaq Composite posted very slight gains, up 0.5 percent at the open.
Wall Street’s jitters threatened to pull the major indices off recent highs, which followed notable spikes fueled by trade deal optimism.
However, fresh concerns around U.S.-China tensions over semiconductor policy and the latest House vote appear to have pushed investor sentiment into more negative territory.
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Investors reacted unfavorably to the House of Representatives’ passage of a bill focused on lowering taxes and increasing military spending.
There are concerns that the passage of Trump’s tax bill could further accelerate the U.S. deficit.
Investors worry that the current 36 trillion dollar U.S. deficit could balloon by several trillion dollars more. Just days ago, Moody’s downgraded the U.S. credit rating.
This outlook has pushed the 30-year Treasury yield to 5.1 percent, its highest level since October 2023. Meanwhile, the 10-year Treasury note yield continues to hover near 4.6 percent.
Rising long-term interest rates, combined with broader macroeconomic pressures, could drive stocks lower.
As stocks struggle, Bitcoin (BTC) has spiked to a new all-time high above $111k. the gains have also seen altcoins, including Ethereum (ETH) notch some upward action.
Elsewhere in the market, U.S. jobless claims dropped slightly in the week ending May 17. Data on initial filings for unemployment insurance showed a decline of 2,000, coming in at a seasonally adjusted 227,000. That was just below the 230,000 estimate from Dow Jones. Meanwhile, the four-week moving average for jobless claims ticked slightly higher to 231,500.
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