Title: U.S. Market Diary | Dow slips 200 points as one sector surges on Trump post

U.S. stocks eased from record levels on Monday as investors turned cautious ahead of a key inflation report due Tuesday. The Dow Jones Industrial Average fell about 200 points (−0.5%), the S&P 500 dipped roughly 0.3%, and the Nasdaq gave back 0.3% after flirting with fresh highs earlier in the session. With July CPI in focus, markets are weighing whether inflation is re‑accelerating and what it could mean for the Federal Reserve’s rate path.

Economists expect headline inflation to tick up to around 2.8% year over year from 2.7% in June, a move that could complicate hopes for a smooth disinflation glide path. Persistent price pressures, coupled with tariff uncertainty, have revived chatter about stagflation risks—slower growth alongside sticky inflation—an environment that tends to compress equity multiples and challenge policy trade-offs.

Sector performance was mixed, with broad weakness across energy, real estate, and parts of technology. Bond yields held steady, keeping financial conditions relatively unchanged into the data print. In commodities, gold retreated despite ongoing macro jitters, reflecting some profit‑taking and a stronger dollar tone ahead of CPI.

Notably, one industry rallied sharply after a social media post from former President Donald Trump sparked speculative interest. Traders piled into names seen as policy‑sensitive or politically levered, fueling a brisk, headline‑driven move. While such bursts can generate short‑term momentum, they often fade without fundamental follow‑through, so liquidity and risk controls are key for active participants.

What to watch next:
– July CPI: A hotter print could push out expectations for rate cuts and pressure duration‑sensitive equities.
– Earnings revisions: Margin guidance under higher input costs will be critical for sustaining valuations.
– Policy headlines: Trade and tariff updates remain a swing factor for inflation and cyclicals.

Bottom line: Markets are pausing at elevated levels as macro and policy cross‑currents intensify. With the Fed’s reaction function still data‑dependent, near‑term direction hinges on Tuesday’s inflation read and the durability of earnings against a higher‑for‑longer backdrop.