The stock market showed resilience on Monday as major indexes closed higher despite concerns over President Trump’s latest tariff threats. The Dow Jones Industrial Average gained 167.01 points, or 0.38%, to close at 44,470.41. The S&P 500 rose 0.67% to end at 6,066.44, while the Nasdaq Composite climbed 0.98% to 19,714.27.
President Trump announced on Sunday his plans to impose a 25% blanket tariff on all steel and aluminum imports, without specifying when the duties would take effect. He also noted that retaliatory tariffs would be issued on countries that tax U.S. imports. This announcement follows previous tariffs targeting China.
Steel and aluminum stocks saw significant gains amidst the news, with company shares rising 4.8% and 5.6%, respectively. Chipmakers also performed well, boosted by improved sentiment following concerns about the emergence of Chinese AI startup DeepSeek.
Stocks rise amid tariff concerns
Leading tech companies also saw promising gains, as investor outlook remained positive despite recent volatility. “The volatility around DeepSeek and concerns over tariffs do not derail our positive outlook on risk assets, especially in the U.S. Over the short term, we expect lingering volatility on tariff headlines and potential April bill passage in the U.S., but we keep 6,500 as S&P 500 year-end target,” stated JPMorgan’s head of cross-asset strategy, Fabio Bassi, in a note to clients. Investors will closely monitor important economic indicators this week, including the January consumer price index report on Wednesday, initial weekly jobless claims, and the producer price index on Thursday.
Federal Reserve Chair Jerome Powell is also set to speak before Congress on Tuesday morning. UBS equity strategist Sundeep Gantori advised clients to be prepared for opportunities in the artificial intelligence sector amid any near-term volatility. Morgan Stanley anticipates that retailers with sizable capital to invest in AI, data, and automation will grow at an accelerated pace.
Bank of America highlighted the contrast between high expenditures by major AI players and more modest growth in capex among other companies. Despite the significant tariff announcements, market responses have been surprisingly muted, suggesting that investors are adopting a wait-and-see approach to gauge the full impact of these trade measures. As the global economy grapples with the reality of worldwide trade battles, the coming weeks will be crucial in determining the long-term effects on various industries and key commodities.
