By Johann M Cherian and Sukriti Gupta
(Reuters) – Wall Street’s major indexes rose on Tuesday, with the Dow at its highest level in more than a month, as investors weighed President Donald Trump’s executive orders after he took office and awaited his first trade policy measures.
Trump offered no concrete plans for universal tariffs and additional surcharges on his close trading partners as previously promised, but said he was considering imposing tariffs on Canadian and Mexican goods as early as February 1st.
As investors remain cautious about Trump’s tariff policies, which could trigger a global trade war and new inflationary pressures, brokerage firm Goldman Sachs lowered its forecast for a universal tariff this year to 25%, from around 40%. % in December.
“Trump is all about making deals, and that’s what he’s looking to do with his tariffs,” said Dan Boardman-Weston, CEO of BRI Wealth Management.
“So, assuming a government sits down with him and tries to reach a compromise, the tariffs won’t be as severe as people might expect.”
At 11:46 a.m. ET, the S&P 500 was up 396.33 points, or 0.91%, at 43,884.16, the S&P 500 was up 28.95 points, or 0.48%, at 6,025.61 and gained 17.53 points, or 0.09%, to 19,647.73.
Nine of the 11 S&P 500 sectors rose, with the industrial sector leading the way with a 1.8% gain. The equally weighted stock added 1% and hit a one-month high.
The domestically focused small-cap index rose 1.5% to a one-month high.
Stocks of automakers, which are most sensitive to tariffs because of their vast supply chains, rose. Ford (NYSE:) gained 1.7%, while General Motors (NYSE:) added 4.7%, following a rating upgrade by German Bank (ETR:).
During the first year of the previous Trump administration, the S&P 500 rose 19.4%, while the benchmark index rose nearly 68% during his four-year term, but experienced bouts of volatility, resulting in part from Trump’s trade war with China.
Last week, the S&P 500 and Dow Jones posted their biggest weekly percentage gains since early November, helped by strong bank profits and signs of a slowdown in underlying inflation.
However, inflation remains above the Federal Reserve’s 2% target, fueling concerns that Trump’s policies could delay the central bank’s pace of monetary policy easing.
Economists expect the Fed to leave borrowing costs unchanged at its meeting next week and traders expect the first interest rate cut to come in July, according to data compiled by LSEG.
Tech stocks fell, with Apple (NASDAQ:) sliding 4.5% after brokerage Jefferies downgraded its rating to “underperform.”
3M rose 4.5% after reporting upbeat fourth-quarter earnings.
Walgreens fell 13.6% after the Justice Department accused it of filling illegal prescriptions for addictive painkillers and other drugs.
Modern (NASDAQ:) rose 6% after securing $590 million from the United States to accelerate the development of its avian flu vaccine.
Advancing issues outnumbered declining issues by a ratio of 4.64 to 1 on the NYSE and 2.18 to 1 on the Nasdaq.
The S&P 500 recorded 36 new 52-week highs and no new lows, while the Nasdaq Composite recorded 101 new highs and 58 new lows.
