By Johann M Cherian and Sukriti Gupta
(Reuters) – Wall Street’s major indexes rose on Tuesday, with the blue-chip Dow at a more than one-month high, as investors weighed President Donald Trump’s executive orders after taking office and awaited his first step on trade policy.
Trump has not outlined any concrete plans for universal tariffs and additional tariffs on close trading partners as he has previously promised, but has said he is considering imposing tariffs on Canadian and Mexican goods as early as February 1.
While investors remain wary of Trump’s tariff policies, which could trigger a global trade war and new inflationary pressures, brokerage Goldman Sachs cut its forecast for universal tariffs for this year to 25% from around 40% in December.
“Trump is all about making deals, and that’s what he wants to achieve with his tariffs,” said Dan Boardman-Weston, CEO of BRI Wealth Management.
“So, assuming any government sits down with him and tries to work out a compromise, the tariffs won’t be as severe as people might expect.”
At 11:46 a.m. ET, it rose 396.33 points, or 0.91%, to 43,884.16, the S&P 500 gained 28.95 points, or 0.48%, to 6,025.61, and gained 17, 53 points, or 0.09%, to 19,647.73.
Nine of the 11 S&P 500 sectors rose, with leading industrials up 1.8%. Equally weighted, they added 1% and reached a one-month high.
The small-cap index focused on the domestic market rose 1.5% and reached the highest level in a one-month period.
Shares of carmakers, which are most sensitive to tariffs because of their vast supply chains, rose. Ford (NYSE: ) gained 1.7%, while General Motors (NYSE: ) added 4.7%, following a rating upgrade of Deutsche Bank (ETR:).
During the first year of Trump’s previous administration, the S&P 500 rose 19.4%, while the benchmark index rose nearly 68% during his four-year tenure, but saw bouts of volatility stemming in part from Trump’s trade war with China.
Last week, the S&P 500 and Dow posted their biggest weekly percentage gains since early November, helped by strong bank earnings and signs that core inflation is cooling.
However, inflation is still above the Federal Reserve’s 2% target, fueling concerns that Trump’s policies could delay the pace of central bank monetary easing.
Economists expect the Fed to leave borrowing costs unchanged when it meets next week, and traders see the first rate cut in July, according to data compiled by LSEG.
Tech stocks fell, with Apple (NASDAQ: ) slipping 4.5% after brokerage Jefferies cut its rating to ‘underperform’.
3M rose 4.5% after reporting upbeat fourth-quarter earnings.
Walgreens fell 13.6% after the Justice Department charged it with illegally issuing prescriptions for painkillers and other addictive drugs.
Modern (NASDAQ: ) rose 6% after securing $590 million from the U.S. to accelerate development of its bird flu vaccine.
Advancing issues outnumbered decliners by a ratio of 4.64 to 1 on the NYSE and by 2.18 to 1 on the Nasdaq.
The S&P 500 posted 36 new 52-week highs and no new lows, while the Nasdaq Composite posted 101 new highs and 58 new lows.
