U.S. Stocks Fall Amid Inflation Data, China Tariff Extension

U.S. stocks closed modestly lower on Monday amid cautious trading ahead of key economic data releases, including July's consumer inflation report, which could influence Federal Reserve interest rate decisions. The Dow Jones fell about 200 points, the S&P 500 dropped 16 points, and the Nasdaq declined 64 points, with most sectors showing only modest changes except for significant weakness in oil-related stocks. Investors are focused on inflation data expected to show a slight increase in consumer prices, with markets pricing in a high probability of the Fed lowering rates next month. Trade developments also impacted the market, as President Trump extended the pause on higher U.S. tariffs on Chinese imports for another 90 days and highlighted cooperation in semiconductor sales to China, though a new U.S. government levy on chipmakers' revenue from China sales could affect margins. The outlook remains cautious as investors await further data on inflation, producer prices, retail sales, and industrial production, weighing the potential for Fed policy shifts. Overall, the market's lackluster performance reflects uncertainty amid these economic and trade factors.