US stocks rose 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.
The Dow Jones Industrial Average (^DJI) added 0.2%, after the blue-chip index on Friday booked its worst loss in nearly four weeks. The S&P 500 (^GSPC) rose roughly 0.4%, while the tech-heavy Nasdaq Composite (^IXIC) 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. 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) revenue disappointed. Coca-Cola (KO), Super Micro Computer (SMCI), and Airbnb (ABNB) are set to follow this week.
LIVE 3 updatesGold rallies past $2,900 per ounce amid tariff threats
Gold surged on Monday to trade past $2,900 for the first time ever as escalated tariff threats spurred buying, while Wall Street analysts remained bullish on the safe haven asset.
Gold futures (GC=F) climbed more than 1.4% to around $2,930 after hitting numerous all-time highs last week.
Over the weekend President Trump announced he will introduce that he will introduce 25% tariffs on all imports of steel and aluminum into the US from all countries, on top of existing duties.f
On Friday the President also said he announced a retaliatory tariff plan this week against countries which impose levies on US goods. Meanwhile last Tuesday 10% tariffs went into effect on select Chinese goods.
Wall Street analysts have stayed bullish on the precious metal amid rising tariff threats.
"We continue to see gold as an effective portfolio hedge and diversifier, and believe an allocation of around 5% within a USD balanced portfolio is optimal," wrote Solita Marcelli, chief investment officer for the Americas at UBS Global Wealth Management in a Monday note.
Year-to-date gold is up almost 10%, following a 27% rally in 2024.
