03:55 PM EDT, 10/07/2025 (MT Newswires) -- US equity indexes fell ahead of the close on Tuesday as investors cut exposure to consumer discretionary and communication services after inflation expectations rose and the partial federal government shutdown extended for the seventh day.

The S&P 500 declined 0.5% to 6,709.1, set for its first drop in eight days. The Nasdaq Composite slid 0.7% to 22,782.5, and the Dow Jones Industrial Average moved 0.3% lower to 46,552.3. Consumer discretionary, technology, and communication services were among the steepest decliners. Utilities and consumer staples were the only sectors to post gains.

Among large-cap companies with a market capitalization of $200 billion or more, Tesla (TSLA) and Oracle (ORCL) were among the worst-performing. Tesla unveiled on Tuesday standard versions of its Model 3 and Model Y vehicles with list prices under $40,000 each, according to the company's website. Its shares dropped 4.2%.

Oracle is seeing thin profit margins in its fast-growing artificial intelligence cloud server business, according to internal documents cited by The Information on Monday. Shares dropped 5.5%.

In economic news, consumer expectations for one-year US inflation growth increased to 3.4% in September from 3.2% in the previous month, according to a survey released by the New York Federal Reserve Bank on Tuesday. The first look at consumer confidence for October showed the RealClearMarkets' monthly index falling to 48.3 in October from 48.7 in September.

Most Treasury yields fell, with the two-year down 2.3 basis points to 3.57% and the 10-year rate slumped 2.9 basis points to 4.13%.

Meanwhile, President Donald Trump told reporters on Monday that he is open to discussing healthcare subsidies with the Democrats in an attempt to reopen the federal government, according to Bloomberg. "I am happy to work with the Democrats on their failed healthcare policies, or anything else, but first they must allow our government to reopen," Trump said in a separate Monday post on social media.

Gold futures rose 0.7% to $4,003.60, after scaling yet another peak of $4,014.60 earlier in the session.