US stock indexes experienced a downturn on Tuesday, marking the first drop in seven days.

The S&P 500 fell by 0.4%, remaining within 3.3% of its all-time high from earlier in the year.

The Dow Jones Industrial Average declined by 114 points, or 0.3%, while the Nasdaq Composite also slipped 0.4%.

In Australia, futures pointed to an anticipated rise of 50 points, or 0.6%, for the ASX, following a previous increase of 0.6% on Tuesday.

This boost comes in the wake of the Reserve Bank reducing its benchmark interest rate by a quarter of a percentage point for the second time this year.

In contrast, the Australian dollar fell 0.6% to 64.21 US cents.

On Wall Street, Tesla shares rose by 0.5% as CEO Elon Musk confirmed his commitment to leading the company for at least five more years.

Musk also indicated plans to reduce his political spending, addressing investor concerns regarding the future of the electric car manufacturer.

Treasury yields remained stable after a brief fluctuation earlier in the week, attributed to Moody’s Ratings declaring that the US government no longer warrants a top-tier credit rating due to concerns over rising national debt.

The travel sector faced significant stock losses.

Airbnb's shares dropped by 3.3%, Norwegian Cruise Line fell by 3.9%, and United Airlines decreased by 2.9%.

Viking Holdings, despite reporting better-than-expected quarterly results, saw a 5% decline in its stock price.

Home Depot reported first-quarter profits that fell short of analysts' expectations, leading to a 0.6% decrease in its stock price.

However, the company remains firm on its forecasts for profit and sales growth for the year.

This outlook runs counter to a growing number of other businesses expressing uncertainty about the future due to tariffs and economic conditions.

President Trump has enacted substantial tariffs against trading partners, some of which have been delayed or reversed.

Investors remain hopeful that upcoming trade deals may lead to a reduction of these tariffs, although this outcome is uncertain.

In positive news, D-Wave Quantum saw a notable increase of 25.9% following the introduction of its latest quantum computing system, claimed to address complex problems unmanageable by classical computers.

The S&P 500 concluded the day down 23.14 points to 5,940.46, while the Dow Jones dipped 114.83 to 42,677.24, and the Nasdaq fell 72.75 to 19,142.71.

In the bond market, the yield on the 10-year Treasury rose slightly to 4.47%, while the two-year yield, which is more closely influenced by Federal Reserve actions, decreased to 3.96%.

Concerns persist regarding the potential economic impact of Trump’s tariffs, with speculation that a recession could limit the government’s fiscal intervention capabilities due to growing debt levels.

Analysts suggest that a downturn might exacerbate economic conditions as the government possibly has less capacity to provide support through stimulus measures compared to previous recessions.

Internationally, central banks are preemptively cutting interest rates in response to economic pressures.

China’s central bank, for example, recently reduced its loan prime rates for the first time in seven months, a move welcomed by investors as the world's second-largest economy grapples with the repercussions of increased tariffs.

Additionally, shares in CATL, the largest electric battery manufacturer globally, rose by 16.4% on its initial public offering (IPO) in Hong Kong, raising approximately $4.6 billion, the largest IPO so far this year.