US Stocks Gain as Trump Enacts First Policies

In This Article:

* DJI: +1.24%
* IXIC: +0.64%
* GSPC: +0.82%
* NQ=F: +0.82%
* YM=F: +1.27%

On Tuesday, US stocks surged higher, led by the Dow Jones Industrial Average (^DJI), which surpassed 44,000 and the S&P 500, which topped 6,000. Investors reacted positively to President Donald Trump's initial policy moves, including the potential imposition of tariffs on Mexico and Canada.

The Dow led the rally, climbing over 500 points or 1.2%, driven by strong earnings from 3M Company (MMM). The benchmark S&P 500 (^GSPC) gained nearly 0.9%, while the Nasdaq Composite (^IXIC) rose about 0.6% despite fluctuating performances from Tesla (TSLA) and Apple (AAPL). Nvidia (NVDA) shares gained over 2% after a shaky start to the session.

Wall Street navigated a volatile environment as the newly inaugurated president implemented executive orders, with energy and trade taking center stage. Tuesday marked the first trading day of Trump's second term, with US markets closed on Monday for Martin Luther King Jr.'s holiday.

Trump Holds Off on Tariffs Initially

Markets initially breathed a sigh of relief as Trump refrained from imposing broad-based tariff hikes that many anticipated on his first day in office. However, the President later hinted at the possibility of imposing 25% duties on Mexico and Canada starting February 1.

Treasury Yields Slip

In fixed income markets, the 10-year Treasury yield (^TNX) fell about 4 basis points to around 4.57% on Tuesday, partially recovering from a deeper drop in Asian trading.

Netflix Impresses with Earnings

Netflix (NFLX) reported strong results in its fiscal fourth quarter earnings, exceeding expectations for revenue, earnings, and subscriber growth. The streaming giant announced a $15 billion stock buyback and lifted its full-year revenue outlook.

Apple, Tesla Decline

On the downside, Apple (AAPL) and Tesla (TSLA) shares decreased amid concerns about weak iPhone sales and the removal of pro-EV policies by the new administration.

Eyes on Earnings

The upcoming earnings season will provide further insights for investors. Netflix's positive results set the stage for the release of quarterly reports from other companies, including Capital One (COF), Charles Schwab (SCHW), and United Airlines (UAL).

Trump's Impact on Markets

As Trump's presidency unfolds, investors are closely monitoring his policy actions and potential economic consequences. While the initial market reaction has been positive, it remains to be seen how his decisions will shape the financial markets and the broader economy in the long term.