Shares of financial institutions fell sharply on Tuesday in response to the U.S. initiating tariffs on its trade partners. Duties will raise funds for the government but also hurt the economy. Consumers need to pay more for goods. As a result, demand for products will fall.
Visa (V), Mastercard (MA), Wells Fargo (WFC), and Citigroup (C) were among the credit services and diversified bank stocks that fell. KKR (KKR) was a notably weak performer. KKR stock dropped by 9.19% to close at $120.78. The firm launched a $1.5 billion mandatory convertible preferred stock offering.
In the retail sector, Best Buy (BBY) closed at $75.20, down by 13.3%. The firm posted $13.9 billion in revenue, as operating income increased by 4.9% (adjusted). However, the retailer is forecasting revenue growth of flat to 2% Y/Y.
International Paper (IP) topped at $60 between November 2024 and January. It closed at $51.30, down by 7.25%. The tariff trade war will hurt the paper and lumber industry. As sales worsen, IP stock will likely re-test last May’s lows in the $35 – $40 range. Investors should also be wary of holding resource firms. Teck Resources (TECK) peaked at over $50, closing at $38.64 on March 4.
Alcoa (AA) is at risk of closing below $30. The firm warned that tariffs could cost the U.S. 100,000 jobs.
