Stocks rise to start the week as traders shake off latest U.S. tariff threat: Live updates – CNBC
Source: CNBC
Stocks rose Monday as major tech names outperformed to start the week, while traders looked past the latest U.S. tariff threat from President Donald Trump.
The Dow Jones Industrial Average added 167.01 points, or 0.38%, led by a 4.8% gain in McDonald’s. The 30-stock index closed at 44,470.41. The S&P 500 gained 0.67% to end at 6,066.44, and the Nasdaq Composite climbed 0.98% to 19,714.27.
The market remains jittery on a mix of inflation worry coupled with concern over how Trump’s plan for tariffs could adversely affect the U.S. economy.
Trump told reporters on Sunday that he is planning to announce a blanket 25% tariff on all steel and aluminum imports on Monday. Trump did not specify when the duties would be imposed and noted that he would also issue retaliatory tariffs on countries that tax U.S. imports. The news comes after Trump’s previously announced duties on China.
Steel and aluminum stocks popped. U.S. Steel and Nucor were up 4.8% and 5.6%, respectively. Cleveland-Cliffs climbed nearly 18%, and Alcoa ended the day 2.2% higher.
Shares of chipmakers also rose as sentiment appeared to improve after the late January sell-off in technology stocks, fueled by the concerns around the emergence of Chinese AI startup DeepSeek. Nvidia gained 2.9%, while Broadcom and Micron added 4.5% and 3.9%, respectively. Megacap tech names Alphabet, Amazon and Microsoft were also higher.
“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,” JPMorgan head of cross asset strategy Fabio Bassi said in a note to clients.
The threat of more tariffs comes ahead of a slew of economic data this week. The January consumer price index report is due out Wednesday at 8:30 a.m. ET, followed by initial weekly jobless claims and the producer price index on Thursday. Federal Reserve Chair Jerome Powell will also speak before Congress on Tuesday morning.
Correction: A previous version misstated when Powell is scheduled to speak.
The Dow Jones Industrial Average ended Monday’s trading session 167.01 points higher, or 0.38%, to close at 44,470.41. The S&P 500 gained 0.67% to end at 6,066.44, and the Nasdaq Composite climbed 0.98% to close at 19,714.27.
The optimistic story for tech stocks is still intact despite a bumpy start to 2025, according to UBS.
Shares of Nvidia entered Monday down 3.3% year to date. The Roundhill Magnificent 7 ETF (MAGS) is little changed in 2025. However, UBS equity strategist Sundeep Gantori said in a note to clients that the artificial intelligence trade still has upside from here and that investors should be prepared to take advantage of the next pullback.
“With strong near-term visibility for tech earnings, we remain bullish on the AI theme and maintain our positive view on AI semiconductors and leading cloud platforms. We recommend taking advantage of any near-term volatility to build up exposure to quality AI stocks via buy-the-dip and structured strategies,” Gantori wrote.
Morgan Stanley is very bullish about the benefits retailers will see from artificial intelligence. “Retail is on the cusp of a technology-leap with AI, data and automation,” analyst Simeon Gutman wrote in a recent note to clients.
He anticipates the tech investments will allow larger retailers to continue to grow bigger and at an accelerated pace. One reason is they have the deepest pockets and will be able to invest to grow, taking advantage of the trove of customer data and the benefits of advertising and automation.
Gutman noted that Walmart’s capital spending plans are four times larger than the retailer with the second-biggest budget, Costco. Not only that, but Walmart’s capex is equal to nearly 60% of the top five retailers combined and 70% of the rest of the firm’s retail coverage combined.
Artificial intelligence clouds are forming over parts of the market that are not just AI, according to Bank of America.
Analyst Ohsung Kwon wrote in a Sunday note to clients that overall capital expenditures from companies reporting so far remain weak, while AI-related capex from hyperscalers continues to climb. Price reactions after the “Magnificent Seven” earnings reports suggest growing concerns around their monetization compared to their spending, he pointed out, particularly as the emergence of China’s DeepSeek reminds the U.S. market “of the bear case for AI semis.”
“Geopolitical risks in the midst of an AI arms race vs. China poses a threat to US Semis, and the spend mandate compromises the cost-cutting options that mega cap tech companies had in 2022/23. Moreover reported capex from 234 co’s so far is tracking just +3% ex. Mag. 7 and Tech in stark contrast to total capex of +23% YoY,” he wrote.
More than 300 companies in the S&P 500 have reported earnings so far, and results have been better than the hi
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