Dow Jones futures rose modestly on Sunday night, alongside S&P 500 futures and Nasdaq futures, as President Donald Trump announced plans to raise tariffs. He will unveil new tariff hikes this week, starting with a 25% tariff on all steel and aluminum imports, effective Monday.
Dow Jones futures rise as Trump plans tariff hikes
This past week saw significant market volatility, driven by Trump’s tariff announcements, notable earnings, and economic data. Major indexes ultimately retreated, with the Nasdaq falling below key support levels. In this context, analysts advise investors to focus on weekly charts for a clearer perspective on market trends.
Tesla (TSLA) sold off last week, reaching 2025 lows and posing a threat of breaking below a recent consolidation phase. The stock has tumbled 10.6% for the week, settling at 361.62 and is now 26% below its all-time high of 488.54 from December 18. Tesla’s relative strength line is at a three-month low, and there are concerns that increasing political statements from CEO Elon Musk may be affecting sales in Europe and the U.S.
The Dow Jones futures climbed 0.2% compared to fair value, while S&P 500 futures advanced 0.35% and Nasdaq 100 futures rose 0.6%. Despite a modest opening lower for futures, the market is gearing up for a key week ahead with multiple earnings reports anticipated.
President Trump stated he would also announce reciprocal tariffs later in the week for countries that impose duties on U.S. goods. Last week, he implemented a 10% tariff hike on China while suspending 25% tariffs on Mexico and Canada for 30 days. Reports indicate that China may impose tariffs of up to 15% on U.S. autos and energy, although these are not significant imports, and Beijing is preparing a list of U.S. companies for investigation, including Broadcom (AVGO).
Key earnings reports this week include results from Robinhood (HOOD), Shopify (SHOP), Palo Alto Networks (PANW), Howmet Aerospace (HWM), AppLovin (APP), DoorDash (DASH), HubSpot (HUBS), and Reddit (RDDT). Additionally, the January Producer Price Index (PPI) and Consumer Price Index (CPI) inflation reports are set to be released this week.
The market has been jittery, reacting to inflation concerns and potential impacts from Trump’s tariff strategies on the U.S. economy. Lydia Boussour, a senior economist at EY-Parthenon, highlighted that “steep tariffs and heightened policy uncertainty could push businesses to increasingly adopt wait-and-see behaviors and pull back on hiring,” potentially leading to a slowdown in job growth, reduced income, and restrained consumer spending amid higher inflation.
On Friday, the S&P 500 index declined by 1%, reflecting heightened tariff anxiety and a drop in consumer sentiment. At the same time, U.S. Treasury yields decreased, with the 10-year yield sinking to 4.48% after hitting a low of 4.4% during the week.
Trump’s administration indicated that it would also consider additional tariffs on the European Union. The market remained cautious, impacted by Trump’s shifting policies rather than solely economic data. Futures for S&P 500 and Nasdaq gained in early Asian trading, with South Africa’s rand falling following the freeze of all U.S. aid to the nation over rights claims associated with a new land-expropriation law.
In commodities, oil prices steadied after recent declines. The upcoming CPI and PPI reports, along with Fed Chair Jerome Powell’s congressional testimony, are pivotal moments for markets as they navigate the implications of tariffs and inflation data.
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