U.S. stocks struggled on Monday to recover ground lost at the end of last week after President Donald Trump said tariffs on goods from Canada and Mexico will likely go forward when a month-long delay on their implementation expires next week.

Separately, the European Union plans to expand the list of U.S. goods it will target with retaliatory tariffs if Trump follows through on his threat to impose duties on steel and aluminum exports, according to Bloomberg.

The broad S&P 500 closed down 0.5%, or 29.87 points, to 5,983.26; the Dow inched up 0.076%, or 33.19 points, to 43,461.21 and the tech-heavy Nasdaq fell1.21%, or 237.08 points, to 19,286.93. The benchmark 10-year Treasury yield slipped to 4.402%.

The tariff escalation continues to rattle investors who fear all out trade wars will rekindle inflation before the Federal Reserve can get it under control, weaken economic growth and hurt consumer sentiment.

A survey last week showed consumer are feeling more pessimistic, with inflation fears creeping up again amid Trump's constant threats of broad tariffs. Another economic report showed the services sector, which has been strong the past couple of years, fell into contractionary territory. All those worries pushed the three major U.S. stock indexes into the red last week, despite back-to-back record highs in the broad S&P 500 earlier in the week. The blue-chip Dow ended up posting the biggest weekly loss since October.

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Major events expected this week

Investors are likely biding time, setting up for some major events this week. Among them, semiconductor darling Nvidia is due to report earnings after the market close on Wednesday. It'll be Nvidia's first earnings report since China's DeepSeek artificial intelligence model roiled the markets. Nvidia shares were last down more than 3% on Monday, but they've clawed back deep losses from the day DeepSeek grabbed headlines.

The DeepSeek AI model is supposed to rival its U.S. counterparts OpenAI and ChatGPT but built on a shoestring budget. That cast doubt on whether U.S. companies need to spend billions on AI and if they do, how they make back what they spent and more.

On Tuesday, Home Depot is slated to report earnings and rival Lowe's is scheduled to give its report on Wednesday. These reports may give investors a better view of how consumers and the housing market are faring. Retail giant Walmart expressed some caution last week when it reported quarterly results.

Aside from company news, investors also will focus on another inflation report on Friday. January's personal consumption expenditures index is due Friday morning and is the Federal Reserve's preferred inflation gauge to determine interest rate policy.

Economists, on average, expect the inflation gauge to dip to 2.5% from 2.6% in December. That's still steps away from the Fed's 2% inflation target and with possible tariffs looming that could reignite inflation, most economists have pared back expectations for rate cuts this year. A growing number are even saying the rate cutting cycle is over.

Corporate news

While investors wait for the main events later this week, they're looking at some of the day's movers. They include:

• Domino’s Pizza shares fell 1.46% after the pizza chain's earnings during the final few months of last year fell below analysts' forecasts.
• Microsoft stock dipped 1% after TD Cowen said in a report the software giant has begun canceling leases for a substantial amount of datacenter capacity in the U.S., which could reflect concerns about whether it’s building more AI computing than it will need over the long term. Earlier this year, Chinese upstart DeepSeek released a competitive open-source AI model at a fraction of the cost, which had for a time, many investors questioning whether U.S. companies' massive AI spending has been necessary. Microsoft denied any changes to its data center strategy, according to Jefferies analysts.
• Apple shares edged up less than 1% after the company said it plans to spend more than $500 billion over the next four years to expand its manufacturing footprint in the U.S. Plans include hiring 20,000 workers and a new factory to produce servers supporting Apple Intelligence, the company’s generative-AI system.
• Coffee chain Starbucks said it's laying off 1,100 corporate employees while not filling several hundred open positions to streamline operations. Shares rose 1.29%.
• Selling in Palantir Technologies shares intensified as investors continue to worry potential U.S. defense spending cuts will cut into the data sofware company's profits. Shares tumbled 10.53%, making Monday the fourth straight down day for the stock.

Cryptocurrency

In a sign of easier regulation around cryptocurrency, Robinhood said the Securities and Exchange Commission dropped its investigation into the online trading platform's cryptocurrency unit with no intention of moving forward with an enforcement action.

Separately, MicroStrategy, now doing business as Strategy, said it purchased about 20,356 bitcoins between Feb. 18 and Feb. 23 to bring its holdings to about 499,096 bitcoins.

However, Bitcoin was still last down 2.41% at $93,978.94 after struggling to break the key psychological milestone at $100,000.

The story was updated with new information.

Medora Lee is a money, markets, and personal finance reporter at USA TODAY. You can reach her at [email protected] and subscribe to our free Daily Money newsletter for personal finance tips and business news every Monday through Friday.