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Trump Rattles Markets: Housing, Defense Stocks Tumble
8 Jan
Summary
- Dow and S&P 500 closed negative for the first time in 2026.
- President Trump's remarks impacted housing and defense sectors.
- Mixed economic data contributed to market volatility.
Benchmark indices on Wall Street experienced a sharp decline on Wednesday, January 8, 2026, resulting in the first negative closing day of the year for the Dow Jones and S&P 500. President Donald Trump's public statements triggered significant market movements. His directive to limit institutional investors from purchasing single-family homes led to a notable drop in real estate-related stocks, including Blackstone.
Further unsettling the markets, reports indicated that President Trump signed an executive order targeting defense companies. This order reportedly urges them to cease share buybacks and dividends, redirecting funds towards production capacity and research and development. Consequently, major defense contractors saw their stock prices fall, although some recovery occurred in extended trading.
The economic data released on Wednesday presented a mixed picture. Private sector job growth, as indicated by ADP, was slower than anticipated. While job openings saw a year-long low, the services sector, measured by ISM Services PMI, showed robust expansion, reaching its highest point since October 2024. This economic ambiguity, coupled with a strengthening US Dollar and falling precious metal prices, contributed to the day's volatility.
