Headline: US Stocks Rise Despite Tariff Concerns and Fed Outlook
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US stocks closed higher on Wednesday as investors weighed President Trump's latest 25% tariff announcement and digested Federal Reserve minutes for insights into future monetary policy. The benchmark S&P 500 (^GSPC) gained 0.24% to a fresh record high of 6,144.15, building on Tuesday's record close. The Nasdaq Composite (^IXIC) and Dow Jones Industrial Average (^DJI) both rose modestly by around 0.1%.
The minutes from the Fed's January meeting revealed that most central bank officials supported maintaining restrictive interest rates due to concerns about persistent inflation. However, the committee also noted the potential for easing if economic conditions deteriorate.
On the trade front, Trump's threat of additional tariffs on autos, chips, and pharmaceuticals impacted the market. Automobil
e manufacturers faced a potential 25% duty on all foreign imports, starting as early as April 2. Last week, Trump announced global 25% tariffs on steel and aluminum imports, effective March 12.
Despite these tariff concerns, market analysts anticipate that the Fed will continue to cut interest rates later this year. This conviction remains key in stabilizing markets, as investors believe the next move by the Fed is more likely a rate cut than a hike.
However, short sellers have faced losses amid the market rally. Data from S3 Partners indicates that short sellers in US and Canadian markets lost $73 billion year-to-date.
In company news, Intel (INTC) shares fell after analysts expressed skepticism over potential deals with TSMC and Broadcom. Conversely, Apple (AAPL) may face price increases due to potential tariffs on imported products.
Other notable events include the release of the iPhone 16e by Apple, Super Micro Computer's (SMCI) recovery from a scathing report, and Hims & Hers (HIMS) acquisition of Trybe Labs for at-home lab testing.
European stocks experienced a setback on Wednesday, with the pan-European Stoxx 600 (^STOXX) index losing 0.5%. Factors contributing to this decline were disappointing earnings and Trump's tariff plans.