Stocks slip on Wall Street after last week's rally

Stocks on Wall Street closed broadly lower Monday, giving back some of the big gains the market notched last week on hopes for interest rate cuts from the Federal Reserve.

The S&P 500 fell 0.4% and remains near its all-time high. The Dow Jones Industrial Average closed 0.8% lower after setting a record high on Friday. The Nasdaq composite closed 0.2% lower.

The selling was widespread, with health care stocks among the biggest drags on the market. Pfizer fell 2.9% and Eli Lilly and Co. slid 2.3%.

Gains for several big technology stocks helped temper the market’s losses. Alphabet, Google’s parent company, rose 1.2%. Technology heavyweight Nvidia rose 1%.

Treasury yields rose in the bond market following their big drop on Friday amid expectations that the Fed will cut its benchmark interest rate in September.

The yield on the 10-year Treasury rose to 4.28% from 4.25% late Friday. The two-year Treasury yield rose to 3.73% from 3.70% late Friday.

“Markets are just digesting Friday’s news and kind of the increasing odds that we’re going to see a September rate cut from the Fed,” said Anthony Saglimbene, chief market strategist at Ameriprise.

Wall Street is still overwhelmingly betting that the Fed will cut interest rates at its next meeting in September. Traders see an 84% chance that the central bank will trim its benchmark rate by a quarter of a percentage point, according to data from CME Group.

The Fed has been maintaining rates at their current level since the end of 2024 amid worries about inflation heating up as tariffs work their way through the economy to businesses and households.

The central bank has grown increasingly concerned about the state of the job market in the U.S. Its two main focuses are keeping inflation low and supporting conditions for strong employment.

Recent signals have shown that the job market is seemingly stagnating and could possibly weaken, which could prompt the central bank to cut rates. Lower interest rates make borrowing easier, helping to spur more investment and spending, but that could also potentially fuel inflation.

So far, consumer confidence remains mostly solid, though concerns about inflation linger. Wall Street and the Fed will get an update on consumer confidence in the U.S. when business group The Conference Board releases its monthly survey for August on Tuesday. Economists expect overall confidence to remain mostly unchanged from July.

The bigger update will come on Friday, when the government releases an inflation report that is closely monitored by the Fed. An update on inflation earlier in August showed that consumer prices remained modestly higher in July, compared with a year ago. The government’s report on Friday, the personal consumption expenditures price index, is expected to show a similar result.

Economists expect the PCE to show that prices rose 2.6% in July, compared with a year ago. That’s unchanged from the rate in June and hovering just above the Fed’s preferred target of 2%.

Among other big movers on Wall Street Monday: Keurig Dr Pepper, which sank 11.5% after saying it will buy Peet’s Coffee owner JDE Peet’s in a deal worth about $18 billion.

Railroad stocks also fell following a report that Warren Buffett informed CSX management that he is not looking to buy the railroad. Shares in CSX fell 5.1%. Union Pacific dropped 2% and Norfolk Southern gave up 2.5%.

All told, the S&P 500 fell 27.59 points to 6,439.32. The Dow lost 349.27 points to close at 45,282.47. The Nasdaq slid 47.24 points to 21,449.29.

European markets mostly closed lower after Asian markets finished lower overnight.

Wall Street has a few more corporate earnings updates this week, essentially wrapping up the latest round of profit reports and forecasts from U.S. companies.

Nvidia will report its latest results on Wednesday. The company's role as a key supplier of chips for artificial intelligence and its heavy weighting give it outsized influence as a bellwether for the broader market. It has been a driving force for much of the market’s gains, along with several other tech giants with pricey stock values.

“There’s more doubt around the AI theme building,” Saglimbene said. “So I think what NVIDIA has to say is going to be very impactful for not only the whole AI space, but the broader markets in general, because it’s such a large holding in the major indexes like the S&P 500 and Nasdaq.”

On Thursday, Wall Street will get earnings updates from electronics retailer Best Buy and discount retailer Dollar General. Retailers are being closely watched as Wall Street tries to gauge the current and potential future impact on costs and prices from tariffs.

Options trader Tommy Nguyen works on the floor of the New York Stock Exchange, Monday, Aug. 18, 2025. (AP Photo/Richard Drew)

A dealer walks past near screens showing the foreign exchange rates at a dealing room of Hana Bank in Seoul, South Korea, Monday, Aug. 25, 2025. (AP Photo/Lee Jin-man)

A dealer walks past screens showing the Korea Composite Stock Price Index (KOSPI), left, and the foreign exchange rate between U.S. dollar and South Korean won at a dealing room of Hana Bank in Seoul, South Korea, Monday, Aug. 25, 2025. (AP Photo/Lee Jin-man)

A dealer watches computer monitors near the screens showing the Korea Composite Stock Price Index (KOSPI), left, the foreign exchange rate between U.S. dollar and South Korean won and the Korean Securities Dealers Automated Quotations (KOSDAQ) at a dealing room of Hana Bank in Seoul, South Korea, Monday, Aug. 25, 2025. (AP Photo/Lee Jin-man)

A dealer watches computer monitors near screens showing the Korea Composite Stock Price Index (KOSPI) at a dealing room of Hana Bank in Seoul, South Korea, Monday, Aug. 25, 2025. (AP Photo/Lee Jin-man)

ANCHORAGE, Alaska (AP) — A state appeals court is being asked to dismiss felony voter misconduct charges against an Alaska resident born in American Samoa, one of numerous cases that have drawn attention to the complex citizenship status of people born in the U.S. territory.

In arguments Thursday, attorneys for Tupe Smith plan to ask the Alaska Court of Appeals in Anchorage to reverse a lower court's decision that let stand the indictment brought against her. Her supporters say she made an innocent mistake that does not merit charges, but the state contends Smith falsely and deliberately claimed citizenship.

Prosecutors also have brought charges against 10 other people from American Samoa in the small Alaska community of Whittier, including Smith’s husband and her mother-in-law. American Samoa is the only U.S. territory where residents are not automatically granted citizenship by being born on American soil and instead are considered U.S. nationals. Paths to citizenship exist, such as naturalization, though that process can be expensive and cumbersome.

American Samoans can serve in the military, obtain U.S. passports and vote in elections in American Samoa, but they cannot hold public office in the U.S. or participate in most U.S. elections.

About 25 people gathered on a snowy street outside the courthouse before Thursday's hearing to support Smith. One woman, Fran Seager of Palmer, held a sign that said, “Support our Samoans. They are US nationals.”

Smith's husband, Michael Pese, thanked the American Samoa community in the Anchorage area. “If it wasn’t for you guys, I wouldn’t be strong enough to face this head on,” he said.

State Sen. Forrest Dunbar, a Democrat who attended the rally, said the Alaska Department of Law has limited resources.

“We should be going after people who are genuine criminals, who are violent criminals, or at least have the intent to deceive,” he said. “I do not think it is a good use of our limited state resources to go after these hardworking, taxpaying Alaskans who are not criminals.”

Smith was arrested after winning election to a regional school board in 2023. She said she relied on erroneous information from local election officials when she identified herself as a U.S. citizen on voter registration forms.

In a court filing in 2024, one of her previous attorneys said that when Smith answered questions from the Alaska state trooper who arrested her, she said she was aware that she could not vote in presidential elections but was “unaware of any other restrictions on her ability to vote.”

Smith said she marks herself as a U.S. national on paperwork. But when there was no such option on voter registration forms, she was told by city representatives that it was appropriate to mark U.S. citizen, according to the filing.

Smith “exercised what she believed was her right to vote in a local election. She did so without any intent to mislead or deceive anyone,” her current attorneys said in a filing in September. “Her belief that U.S. nationals may vote in local elections, which was supported by advice from City of Whittier election officials, was simply mistaken.”

The state has said Smith falsely and deliberately claimed citizenship. Prosecutors pointed to the language on the voter application forms she filled out in 2020 and 2022, which explicitly said that if the applicant was not at least 18 years old and a U.S. citizen, “do not complete this form, as you are not eligible to vote.”

The counts Smith was indicted on “did not have anything to do with her belief in her ability to vote in certain elections; rather they concerned the straightforward question of whether or not Smith intentionally and falsely swore she was a United States citizen,” Kayla Doyle, an assistant attorney general, said in court filings last year.

One of Smith's attorneys, Neil Weare, co-founder of the Washington-based Right to Democracy Project, said by email last week that if the appeals court lets stand the indictment, Alaska will be “the only state to our knowledge with such a low bar for felony voter fraud.”

Bohrer reported from Juneau, Alaska.

Michael Pese and his wife, Tupe Smith, stand outside the Boney Courthouse in Anchorage, Alaska, Thursday, Jan. 15, 2026, ahead of the Alaska Court of Appeals hearing a challenge to the voter fraud case brought against her by the state. (AP Photo/Mark Thiessen)

Michael Pese, left, his wife, Tupe Smith, and their son Maximus pose for a photo outside the Boney Courthouse in Anchorage, Alaska, Thursday, Jan. 15, 2026, ahead of the Alaska Court of Appeals hearing a challenge to the voter fraud case brought against her by the state. (AP Photo/Mark Thiessen)

FILE - Tupe Smith poses for a photo outside the school in Whittier, Alaska, May 13, 2025. (AP Photo/Mark Thiessen, File)