04:47 PM EDT, 09/02/2025 (MT Newswires) -- US benchmark equity indexes fell for a second straight session Tuesday as Wall Street evaluated renewed uncertainty tied to President Donald Trump's tariffs, while gold hit record highs amid increased rate-cut bets.

The Nasdaq Composite dropped 0.8% to 21,279.6, while the S&P 500 lost 0.7% to 6,415.5. The Dow Jones Industrial Average decreased 0.6% to 45,295.8. The three indexes scored losses Friday.

Among sectors, real estate led the decliners on Tuesday, while energy paced the gainers.

On Monday, US markets were closed for the Labor Day holiday.

Trump will ask the US Supreme Court for an "expedited ruling" to overturn a decision by an appeals court that most of his global tariffs were illegal, CNBC reported Tuesday.

In announcing the ruling Friday, the US Court of Appeals for the Federal Circuit said that the law invoked by Trump to implement the tariffs doesn't grant him the power to do so. The court allowed the duties to remain in place through Oct. 14, Reuters reported.

If the Supreme Court decides to strike down the use of the International Emergency Economic Powers Act to impose widespread tariffs, the Trump administration is likely to resort to other options to continue to implement levies, UBS Securities said in a note e-mailed Tuesday. "However, many of the other authorities have legal requirements," the brokerage wrote.

Gold jumped 2.4% to $3,599.40 per troy ounce Tuesday, a new record. Silver rose 2.4% to $41.68 per ounce.

"Fundamentally, investment metals remain supported by the prospect of Federal Reserve rate cuts amid US stagflation risks, a weaker dollar, concerns over Fed independence, aggressive central bank demand, persistent inflation, and a general level of political and economic turmoil around the world," Saxo Bank said in a note.

The probability that the US central bank will reduce its benchmark lending rate by 25 basis points later this month rose to about 92% Tuesday from 86% Friday, according to the CME FedWatch tool. The odds of another pause fell to 8.4% from 14%.

Gold prices have an inverse relationship with interest rates.

US Treasury yields rose Tuesday, with the 10-year rate increasing 5.1 basis points to 4.28% and the two-year rate adding 2.6 basis points to 3.65%.

In economic news, the Institute for Supply Management's US manufacturing purchasing managers' index improved to 48.7 last month from 48 in July, but marked a sixth straight contraction.

"Tariffs are still putting upward pressure on input costs and this likely will intensify over the next couple of months," Oxford Economics said. "The prices paid index won't have any bearing on whether or not the Federal Reserve opts to cut interest rates in September, that burden falls on the August employment and consumer price reports."

S&P Global ( SPGI ) said its manufacturing PMI rose to 53 in August from 49.8 the month prior, marking the "strongest improvement in operating conditions" since May 2022.

Official data are expected to show Friday that the US economy added 74,000 jobs in August, compared with a 73,000 gain reported for July, according to a Bloomberg-compiled consensus.

West Texas Intermediate crude oil advanced 2.6% to $65.68 a barrel Tuesday.

"Oil prices rose amid heightened concerns over supply disruptions stemming from the escalating conflict between Russia and Ukraine," D.A. Davidson said in a client note.

In company news, Kraft Heinz ( KHC ) said it will split into two public companies to improve brand performance and reduce operational complexity, a move that left Berkshire Hathaway ( BRK/A ) (BRK.A, BRK.B) Chief Executive Warren Buffett disappointed. Kraft Heinz ( KHC ) shares sank 7%, the steepest decline on the S&P 500.

Academy Sports and Outdoors ( ASO ) shares slumped 7.6% after the sporting goods retailer's fiscal second-quarter earnings unexpectedly declined year over year.

PepsiCo ( PEP ) shares increased 1.1% as Elliott Investment Management urged the company to revamp its North American beverages and snacks businesses in a move that the activist investor said would unlock additional shareholder value.

Some 98% of S&P 500 companies have logged quarterly results in the ongoing reporting cycle, with earnings up 12.4% year over year on revenue growth of 6.3%, Oppenheimer Asset Management said. Before the start of the quarter, bottom-up estimates from Forbes put analysts' projected bottom-line growth at 4.8%, according to the brokerage.