Wall Street pulls back after Tesla drops on Musk-Trump clash
Trump warned of retribution against Tesla and other Musk ventures after the billionaire railed against his sweeping tax cut bill
By AFP
Last Updated: Jul 02, 2025, 10:25 IST1 min
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Wall Street stocks retreated from records early Tuesday while Tesla sank as President Donald Trump"s sweeping tax cut bill faced hurdles in Congress and renewed criticism from Elon Musk.
Prospects for the legislation, which also contains deep cuts to social spending programs and clean energy, looked uncertain as senators sparred over numerous amendments.
Meanwhile, Trump warned of retribution against Tesla and other Musk ventures after the billionaire railed against the legislation, battering shares of Musk"s electric car company.
About 25 minutes into trading, the Dow Jones Industrial Average was up 0.3 percent at 44,214.87.
The broad-based S&P 500 dipped 0.1 percent to 6,197.55, while the tech-rich Nasdaq Composite Index declined 0.3 percent to 20,312.16.
Shares of Tesla sank around five percent after Trump said he would consider deporting Musk and directing the Department of Government Efficiency (DOGE) to scrutinize the Tesla and SpaceX founder"s government subsidies.
Musk, a mega-donor to Trump in the 2024 election who headed DOGE before leaving Washington earlier this spring, has called for a new political party in response to Trump"s bill.
The row weighs on investor sentiment because "Tesla is extraordinarily popular with speculative traders," said Steve Sosnick of Interactive Brokers.
"If there"s a big drop in that stock, I do think it sort of hurts the mood of the market."
Analysts also said the market was poised for a pullback following an end-of-the-quarter influx of money from investors.
Among other individual companies, Boeing rose 0.8 percent after it announced it hired Jesus "Jay" Malave as chief financial officer, recruiting the executive from Lockheed Martin.
The company also said it named Stephen Parker as head of the company"s defense and space division, after previously appointing him acting head.
First Published: Jul 02, 2025, 10:25
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