US Stocks Rebound Amid Trump Tariff Announcements
US stocks rallied on Monday as investors shrugged off President Trump's latest tariff threats, which include new levies on steel and aluminum imports. The Dow Jones Industrial Average (DJI) gained nearly 0.4%, recovering from its worst loss in almost four weeks on Friday. The S&P 500 (GSPC) rose roughly 0.6%, while the Nasdaq Composite (IXIC) jumped almost 1%, buoyed by a 3% surge in shares of AI chip giant Nvidia (NVDA).
Investors weighed Trump's announcement to impose additional 25% tariffs on steel and aluminum from all countries, with the official announcement expected on Monday. The new tariffs are likely to benefit US steel companies, whose stocks surged. Cleveland-Cliffs (CLF), Nucor (NUE), and US Steel (X) all gained, while aluminum producer Alcoa (AA) also rose.
Markets expect Trump to announce reciprocal tariffs on all trading partners that could match the duties levied on US products by each country. However, Monday's gains suggest that investors may be becoming accustomed to Trump's trade salvos, with some analysts viewing them as negotiation tactics.
Concerns about the potential inflationary impact of the tariff hikes remain, which could potentially lead to interest rate cuts being stalled. The January Consumer Price Index reading, due on Wednesday, will be closely watched for clues, along with updates on retail sales. The latest New York Fed survey showed consumers' long-term inflation expectations ticking higher to 3%, the highest reading since May 2024.
In corporate news, 78 S&P 500 companies are set to report earnings this week. McDonald's (MCD) shares rose after same-store sales beat expectations, while Coca-Cola (KO), Super Micro Computer (SMCI), and Airbnb (ABNB) are also scheduled to report.
Notable Stock Updates:
* Super Micro Computer (SMCI): Shares surged 15% on critical business updates and investor scrutiny amid recent accounting challenges.
* monday.com (MNDY): Shares climbed over 25% after reporting strong fourth-quarter earnings that exceeded revenue and profit expectations.
* Cleveland-Cliffs (CLF): Shares soared 15% following Trump's announcement of steel and aluminum tariffs, benefiting the company and other steel producers.
* Nvidia (NVDA): Shares rallied more than 3% as analysts remain bullish on the stock, despite concerns about Chinese AI model development.
* Rivian (RIVN): Shares gained 3% as the company opened up orders for its Rivian Commercial van beyond its initial launch partners.
* Energy stocks: Gained on rising oil prices, with the S&P 500 Energy Sector (XLE) outperforming tech and consumer discretionary sectors.
* Gold: Surged to new records above $2,900 per ounce amid Trump's tariff threats and safe-haven buying.