Stock Market Live: Tesla Falls, Dow and Nasdaq Slip as Senate Acts on Tax Plan and AI Law

After a volatile first half marked by Trump’s tariff policies and renewed Fed rate cut speculation, the S&P 500 has posted a 5% year-to-date gain. As trading picks up in July, investors are entering the second half of 2025 with fresh concerns and expectations.

Here are six key questions shaping market sentiment now:

1. Will the Fed deliver a major rate cut amid slowing data?
2. Are more tariffs coming as Trump pushes his trade agenda?
3. Can corporate earnings support current market valuations?
4. How will the Musk–Trump conflict impact Tesla and tech stocks?
5. Is inflation cooling fast enough to shift the Fed’s stance?
6. Could election risks or global tensions disrupt momentum?

The first half of 2025 can be summed up through the lens of three major stocks — each representing a core theme driving markets this year.

Boeing (BA) has become a symbol of government-backed resilience, frequently tied to trade discussions and seen as benefiting from Washington’s strategic positioning.

Walmart (WMT), meanwhile, highlights the downside of tariff pressures. The retail giant has flagged rising costs and held back on full-year guidance, signaling uncertainty in consumer pricing and demand.

Tesla (TSLA) continues to be a story of volatility — both from market swings and the ongoing spotlight on Elon Musk, whose ties to political shifts and public statements have added to the unpredictability.

Together, these companies tell the broader story of a market navigating political influence, policy changes, and shifting investor sentiment in 2025.

Senate Republicans have dropped a controversial measure that would’ve blocked states from setting their own AI regulations for the next decade — a key concession as President Trump’s massive budget and tax bill struggles to advance.

The AI provision, backed by many in Silicon Valley, was pulled during a late-night session after Sen. Marsha Blackburn (R-TN) reversed her support for a compromise deal. The move undercut what had been one of the more tech-friendly parts of the bill.

AI-related stocks like Nvidia (NVDA) slipped in early trading following the news, while broader tech shares remained mostly flat ahead of the open.

With time running short before Trump’s July 4 deadline, the bill faces new uncertainty in the Senate.

The 10-year Treasury yield dropped to 4.20% on Tuesday — its lowest level since early May — as investors look ahead to Federal Reserve Chair Jerome Powell’s appearance at a major central banking event in Portugal.

Powell will speak later today at the European Central Bank’s annual forum in Sintra, where he’s expected to weigh in on interest rate policy. His remarks come just as political pressure ramps up, with former President Trump reportedly sending him a signed message urging aggressive rate cuts.

With Wall Street increasingly betting on a possible rate cut in the coming months, Powell’s tone today could help shape market expectations.

Stay tuned for live updates from his appearance.

Tesla stock fell by as much as 6% before Tuesday’s market open, following renewed tensions between CEO Elon Musk and President Trump. Trump reignited his attacks, threatening to cut government subsidies not only for Tesla but also for Musk’s other ventures, including SpaceX.

On his social media platform, Truth Social, Trump claimed Musk receives more subsidies than anyone else in history and suggested that without them, Musk might have to shut down his operations and return to South Africa. He also warned that halting rocket launches, satellite projects, and electric car production could save the country a significant amount of money.

The latest dispute comes after Musk criticized Trump’s expansive tax and spending bill, which recently passed a Senate vote. The bill now includes last-minute changes that would phase out electric vehicle tax credits sooner than planned, potentially affecting Tesla buyers, and adds roughly $1 trillion to the overall cost.

US stocks fell Tuesday morning after reaching record highs the day before. Investors are closely watching President Trump’s big budget bill as it moves through the Senate and waiting for updates on trade talks ahead of the July 9 deadline.

The S&P 500 dropped about 0.3%, slipping back after climbing above 6,200 on Monday. The Dow Jones stayed mostly steady, showing little change.

Tech stocks led the decline, with Tesla shares plunging over 7% amid renewed tensions between Elon Musk and Trump. Nvidia dropped 1%, and Meta dipped slightly after both hit record highs recently.

With political and trade issues still unresolved, investors remain cautious about the market’s next moves.