US stocks traded mostly flat on Tuesday as investors paused following Monday’s record-setting session and digested a wave of earnings reports and trade developments.
The S&P 500 opened the day little changed, while the Nasdaq Composite slipped 0.2%.
The Dow Jones Industrial Average gained 40 points, or 0.1%.
Disappointing quarterly results from key firms weighed on sentiment.
Lockheed Martin shares dropped 8% after the aerospace and defence contractor missed revenue expectations for the second quarter.
Philip Morris also fell 7% after reporting weaker-than-expected sales.
Despite these misses, earnings season has shown strength overall. Of the 88 S&P 500 companies that have reported so far, more than 82% have exceeded analyst expectations, according to FactSet.
Investors are closely watching management commentary for insights into macroeconomic conditions, the evolving impact of tariffs, and capital spending tied to artificial intelligence.
Traders also weighed fresh developments on the trade front.
US Treasury Secretary Scott Bessent said the government is likely to extend the August 12 deadline to reach a deal with China, signalling further diplomatic engagement amid ongoing talks.
Looking ahead, attention turns to upcoming earnings from Alphabet and Tesla, scheduled to report on Wednesday.
Their results mark the start of the “Magnificent Seven” tech cohort’s performance disclosures, which are expected to drive a large share of this quarter’s profit growth.
Tuesday’s muted moves followed Monday’s rally, which saw both the S&P 500 and Nasdaq close at record highs.
Earnings fail to cheer stocks
General Motors and Coca-Cola both posted better-than-expected earnings for the second quarter on Tuesday, but the market reaction was muted to negative in early trade.
GM beat analyst estimates and reaffirmed its trimmed full-year guidance, noting ongoing efforts to reduce exposure to tariffs.
Despite the earnings beat, shares of the automaker fell about 3%, indicating lingering concerns around macroeconomic headwinds and geopolitical risks.
Coca-Cola also topped Wall Street forecasts for both adjusted earnings per share and revenue.
However, the results failed to impress investors, with the stock edging slightly lower.
The subdued response suggests investors may be focusing more on future growth signals and cost pressures than on headline beats.
Bessent on China tariff deadline
US Treasury Secretary Scott Bessent said on Tuesday that he will meet his Chinese counterpart next week in Stockholm, with talks likely to include an extension of the August 12 deadline for higher tariffs.
Speaking on Fox Business Network’s Mornings With Maria, Bessent said the current state of US-China trade was “in a very good place” and described the upcoming meetings as part of a “very constructive” phase in bilateral relations.
“We’re going to be able to get a lot of things done now that trade has kind of settled in at a good level,” he said.
While earlier tariff negotiations focused primarily on restoring the flow of Chinese rare earths and US semiconductor software and materials, Bessent noted that the scope of discussions in Stockholm would be broader.
Among the issues on the table: ways to reduce China’s heavy reliance on manufacturing and exports.
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