"The upward momentum of the Dow Jones (US30) is showing clear signs of slowing as the index faces pressure from multiple fronts - including escalating tariff risks, mounting U.S. public debt, and an increasingly conflicted monetary-fiscal policy environment. Although the Federal Reserve has begun easing financial conditions through rate cuts, Wall Street investors remain hesitant to return to sustained equity buying, particularly in the industrial and financial sectors that make up a large share of the index."
"Leading industrial giants within the Dow - including Caterpillar, 3M, Honeywell, Boeing, and United Technologies - all suffered notable declines last week as investors grew concerned about potential margin compression. These firms have deep supply-chain exposure to China, spanning components, electronics, and raw materials. According to Bloomberg Economics, if the 100% tariff is fully implemented, input costs for U.S. industrial companies could rise by 5-7%, while net profit margins could narrow by 0.4-0.6 percentage points."
"Beyond the industrial sector, financial and retail stocks have also come under pressure as fourth-quarter earnings growth expectations are revised downward. Goldman Sachs, JPMorgan, and American Express - three heavyweight components of the Dow Jones - all recorded moderate selling pressure in recent sessions amid concerns over rising public debt and volatile interest rates. From a macroeconomic perspective, the Fed has officially begun its first rate-cutting cycle after more than two years of tightening, and markets are pricing in another 25-basis-point cut in November."
The Dow Jones has lost upward momentum due to escalating tariff risks, rising U.S. public debt, and a conflicted monetary-fiscal backdrop. The Federal Reserve has begun easing through rate cuts, yet investors remain hesitant to resume sustained equity buying, especially in industrial and financial sectors. U.S. plans to impose 100% tariffs on China imports from November 1, 2025 triggered a sharp market correction. Industrial giants including Caterpillar, 3M, Honeywell, Boeing, and United Technologies declined amid supply-chain exposure and potential margin compression. Bloomberg Economics estimates 100% tariffs could raise input costs 5-7% and narrow net margins 0.4-0.6 percentage points. Financials and retail stocks have weakened as Q4 earnings growth expectations are revised downward.
Read at London Business News | Londonlovesbusiness.com
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