Dubai: US equity markets inched down amid uncertainty on Monday — having hit record high just five days earlier — in the first trade session after US President Donald Trump’s move to curb entry of citizens from seven Muslim-majority countries.

About half an hour after trade began, the Dow Jones Industrial Average was 95 points lower, at 19,998, having crossed the keenly-anticipated 20,000 mark last week. The S&P 500 was also lower, inching down 0.56 per cent, as the Nasdaq Composite slid 0.85 per cent.

Across the pond, European stocks retreated as well, with the FTSE 100 0.8 per cent lower around an hour before trade ended, while the FTSE 250 was 0.45 per cent lower.

It was red across the board elsewhere in Europe where Germany’s DAX was down 0.83 per cent, and France’s CAC 40 was down 0.84 per cent.

The drop follows an executive order signed by Trump on Friday to suspend refugee entries to the US for 120 days, and suspend immigration and visas for citizens from seven countries that include Iran, Iraq, Libya, Sudan, Syria, Yemen, and Somalia.

Investors as well as Trump’s own supporters, including his vice president Mike Pence, had long argued that despite the president’s stance, an immigration ban would never be effective.

Jameel Ahmad, vice-president of market research at FXTM, said there was an air of caution in markets on Monday, especially after the Dow Jones, Nasdaq, and S&P 500 all reached record highs a week earlier.

“It is very possible that the reason for this caution, and the European markets slipping lower is due to investors digesting those record moves seen in the US last week.

“There is also no denying that the turmoil caused by the Trump administration banning certain nationals from entering the United States, which has caused anger worldwide, could be linked to the subdued atmosphere,” he said in a note.

Ahmad added, “Whether it is building a wall, banning certain nationalities, starting a trade war, or pretty much anything else President Trump may do to upset people, it does risk both creating and deepening a negative perception of the US.”

Since Trump’s win in November, investors had been pouring into equity markets on the back of promises of more frequent interest rate hikes, tax cuts, and simpler regulations.

They have not, however, priced in some of Trump’s more outlandish rhetoric such as building a wall along the Mexican border, an immigration ban, and potential trade wars.

In the UAE, equity indices were almost flat, with Dubai’s main index edging up 0.34 per cent as the Abu Dhabi bourse’s main index crawled up 0.09 per cent.

Away from equities, the dollar pared an earlier decline, while gold prices fluctuated. German price growth at the fastest pace in three and half years in January was the catalyst for higher government bond yields, especially in Europe.

— With inputs from Bloomberg