US Stocks End Mixed on Tariff Concerns and Economic Data

U.S. stocks ended mixed on Tuesday, with investors grappling with uncertainty over President Donald Trump's latest tariff announcements and looking ahead to key economic data.

Tariff Concerns Weigh

The Dow Jones Industrial Average (DJI) gained a modest 0.3%, while the benchmark S&P 500 (GSPC) closed barely above flat. However, the tech-heavy Nasdaq Composite (IXIC) pulled back by 0.4%.

Investors were cautious ahead of Trump's planned announcement of tariffs on all steel and aluminum imports, which could potentially impact trading partners like Canada and Mexico. The tariffs are part of Trump's "America First" policy aimed at protecting domestic industries.

Economic Data in Focus

Traders also kept an eye on upcoming inflation data. The January Consumer Price Index (CPI) is scheduled for release on Wednesday, and economists predict it will show a slight slowdown in headline inflation to 2.9%. This would be the lowest level since April 2021.

The Federal Reserve is closely monitoring inflation and may need to cut interest rates if it persists. Fed Chair Jerome Powell emphasized the need for the central bank to remain independent and focused on economic data at a Congressional hearing.

Corporate Earnings

Several companies reported earnings before the bell, including Coca-Cola (KO) and Super Micro Computer (SMCI).

Coca-Cola executives discussed the potential impact of tariffs and rising input costs. The company expects to navigate these challenges with pricing adjustments and alternative packaging options.

Super Micro Computer's stock initially fell around 7% but later recovered as it released preliminary earnings that missed market estimates. Investors are awaiting the company's business update after the market closes for further details on its strategy and outlook.

Oil Gains Amid Russian Sanctions

Energy stocks benefited from a rise in oil prices. Brent crude futures (BZ=F) gained 1.4% to nearly $77 a barrel as investors assessed the impact of US sanctions on Russian crude supply.

Conclusion

Uncertainty over tariffs and economic data led to a cautious trading day on Tuesday. Investors will continue to monitor these developments as well as corporate earnings reports for guidance on the market's future direction.