Stock market/ Trump tariffs/ Wall Street/ S&P 500 records/ retail earnings/ Treasury yields/ NEW YORK/ Newslooks/ J. Mansour/ Morning Edition/ U.S. stocks remain near record highs on Tuesday, with the S&P 500 rising 0.3%, despite President-elect Donald Trump’s announcement of sweeping tariffs on Mexico, Canada, and China. Investors are cautiously optimistic, viewing the tariffs as potential negotiation tactics rather than definitive policy. Retail and tech stocks showed mixed results, while the bond market saw little movement following Trump’s selection of Scott Bessent as Treasury secretary.
Wall Street Holds Its Ground Amid Tariff Concerns
Quick Looks
- S&P 500 Climbs: Up 0.3% and near all-time highs.
- Tariff Talk Sparks Uncertainty: Trump’s tariff threats target U.S. trade partners.
- Mixed Retail Results: Kohl’s plunges, Dick’s Sporting Goods rises.
- Tech Gains: Nvidia and Amazon lead market strength.
Wall Street Stays Strong Despite Trump’s Tariff Threats
Deep Look
Wall Street remained resilient Tuesday despite President-elect Donald Trump’s proposal to impose sweeping tariffs on imports from Mexico, Canada, and China. While global markets reacted cautiously, U.S. investors appear to be betting that the tariff threats might serve as negotiating leverage rather than immediate policy shifts.
The S&P 500 rose 0.3%, maintaining its recent record-breaking momentum, while the Dow Jones Industrial Average dipped 0.4%. The Nasdaq composite climbed 0.6%, buoyed by gains in tech stocks.
Tariff Concerns Overshadow Optimism
Trump announced a potential 25% tariff on goods from Mexico and Canada and a 10% tariff on Chinese imports as part of his effort to combat illegal immigration and drug trafficking. Economists and market analysts warn that such tariffs could disrupt global trade, inflate prices for U.S. consumers, and hurt corporate profit margins.
Key Sectors Affected:
- Auto Industry: Stocks like General Motors (-5.5%) and Ford (-2.3%) declined on fears of higher costs for imported parts and materials.
- Retailers: Increased costs on imported goods could translate to higher prices for consumers and reduced spending.
Mixed Retail Earnings Add to Uncertainty
- Kohl’s: Shares tumbled 19.7% after the retailer reported disappointing results, citing weak apparel and footwear sales. CEO Tom Kingsbury will step down in January, adding to the uncertainty.
- Best Buy: Dropped 8% after missing analysts’ expectations.
- Dick’s Sporting Goods: Gained 1.8% thanks to a strong back-to-school season.
Despite retail challenges, consumer resilience remains critical for avoiding a broader economic slowdown.
Big Tech Lifts Markets
Tech stocks helped offset declines in other sectors, with Nvidia up 1.3% and Amazon rising 1.7%. The tech sector’s strength continues to support the broader market’s record-breaking performance.
Treasury Yields Hold Steady
Following Monday’s decline fueled by optimism around Trump’s Treasury secretary pick, Scott Bessent, yields remained relatively stable. The yield on the 10-year Treasury inched up to 4.29% from 4.28% but remains below last week’s 4.41% close.
Bond markets are watching closely for signs of inflation or disruptions that could arise from Trump’s trade policies.
Global Markets React
- Shanghai: Down 0.1%.
- Hong Kong: Nearly flat.
- Japan’s Nikkei 225: Fell 0.9%.
The potential for retaliatory tariffs and disrupted supply chains has many international markets on edge.
The Bigger Picture
Investors remain cautiously optimistic, taking a wait-and-see approach as Trump’s proposed tariffs may signal the opening move in trade negotiations rather than finalized policy. The market’s reaction suggests confidence in the economy’s ability to weather potential trade disruptions, especially with strong performances in the tech sector and Treasury stability.
You must Register or Login to post a comment.