Stocks diverged to start the week as new tariffs took effect and Washington delivered fresh policy headlines. The Dow slipped, while the Nasdaq notched a record close, powered by Big Tech resilience and AI-linked momentum. Traders balanced the impact of tariff implementation on global supply chains against ongoing strength in growth shares and a still-solid earnings backdrop.

Policy developments took center stage. The White House moved forward with tariffs that investors fear could pressure input costs, dent margins for import-reliant sectors, and revive price stickiness just as inflation progress has slowed. Rate-sensitive pockets, cyclicals with China exposure, and select industrials lagged on the day. In contrast, megacap tech—less exposed to goods flows and more driven by software, cloud, and AI demand—continued to attract flows, lifting the Nasdaq to a fresh high.

Another focal point: President Trump’s nomination of Adrian “Adi” Miran to the Federal Reserve Board. Markets parsed the pick for clues on the future policy mix. If confirmed, Miran would help shape the balance between inflation vigilance and growth support heading into late-year data and the next rate-setting meetings. Any perception that the Board could lean more accommodative would be supportive for long-duration assets and tech; a more hawkish tilt would favor value and shorter-duration exposures. For now, futures markets still imply a cautious path, with cuts seen as data-dependent rather than pre-committed.

Under the surface, sector leadership remained narrow. Semiconductors, cloud, and select software led, while materials, industrials, and consumer names with tariff sensitivity lagged. Bond yields were little changed, leaving equity multiples largely a function of earnings momentum and sentiment. Oil steadied, easing energy input concerns but not fully offsetting the tariff overhang.

What to watch next:
– Corporate guidance on tariff pass-through and supply-chain adjustments.
– Upcoming inflation prints and wage data for signs of re-acceleration.
– Senate dynamics around Miran’s confirmation and potential implications for the Fed’s reaction function.
– Whether market breadth improves beyond megacap tech or remains concentrated, a key tell for the durability of the rally.