US stocks climbed before the bell on Monday, eyeing a bounce-back from sharp losses as steelmakers rallied after President Donald Trump said he will impose new tariffs on steel and aluminum imports.
Dow Jones Industrial Average futures (YM=F) added 0.3%, after the blue-chip index on Friday booked its worst loss in nearly four weeks. S&P 500 futures (ES=F) rose roughly 0.5%, while contracts on the tech-heavy Nasdaq 100 (NQ=F) popped 0.7%.
Investors are weighing Trump's pledge on Sunday to introduce additional 25% tariffs on steel and aluminum from all countries, with the official announcement expected on Monday.
The new metals tariffs are likely to benefit US steel companies, whose stock jumped in pre-market trading. Shares in Cleveland-Cliffs (CLF) and Nucor (NUE) both rose over 8%, while US Steel (X) put on 6% — though questions remain about a proposed Nippon Steel buyout. Aluminum producer Alcoa's (AA) stock also gained.
The move marks another escalation in Trump's fast-moving policy overhaul and in the odds of a trade war. Major US suppliers Canada and Mexico — already threatened with tariff hikes, currently on pause — face significant impact.
Markets were already bracing for reciprocal tariffs, which Trump said will be announced on Tuesday or Wednesday, with immediate effect. The tariffs will apply to all trading partners and will match the duties levied on US products by each country.
But the gains for US stocks on Monday suggests that investors are getting used to Trump's trade salvos. Many now see the announcements as a negotiation tactic only, some on Wall Street say.
That said, markets are concerned the growing list of tariff hikes could drive up inflation, likely to stall interest-rate cuts. The January consumer price index reading due on Wednesday will be closely watched for clues, alongside the week's updates on retail sales.
On the corporate front, 78 S&P 500 companies, are set to report earnings this week. McDonald's (MCD) results are expected on Monday, with Coca-Cola (KO), Super Micro Computer (SMCI), and Airbnb (ABNB) to follow.
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