U.S. Stocks Climb, Yields Slide as Traders Monitor Tariff Developments

U.S. Stocks Climb, Yields Slide as Traders Monitor Tariff Developments

Key Highlights:

• U.S. stock markets closed higher for a second day, with the S&P 500 and Dow Jones each rising 0.8%, while the Nasdaq Composite gained 0.6%.

• Treasury yields dropped sharply amid market uncertainty over evolving tariff policies.

• President Donald Trump temporarily exempted smartphones, computers, and semiconductors from new tariffs, though conflicting statements followed.

• Apple (AAPL) surged 2.2%, while automakers Ford (F), GM (GM), and Stellantis (STLA) posted strong gains.

• Fed Governor Christopher Waller warned that while inflation impacts from tariffs may be short-term, risks to growth and employment could persist.

• Goldman Sachs (GS) beat earnings expectations on record equity-trading revenue.

• DaVita (DVA) fell 3% after reporting a ransomware attack.

• Oil prices inched higher, while gold pulled back slightly.

Market Overview

U.S. equities extended their rally on Monday as traders reacted to updates around the Biden administration’s tariff stance and awaited further clarity. The S&P 500 closed at 5,406, the Dow Jones at 40,524.8, and the Nasdaq at 16,831.5.

Nearly all sectors posted gains, led by real estate and utilities, with the exception of consumer discretionary.

Tariff Confusion and Market Reaction

Markets responded positively to reports that the administration had exempted key tech items like smartphones and semiconductors from tariffs. However, President Trump later stated there were no formal exemptions, adding uncertainty.

Last week, a 90-day pause was granted on some tariffs for non-retaliating countries, while tariffs on China were raised to 145%.

Tech and Auto Stocks Lead

• Apple jumped 2.2% on relief over tariff news.

• Automakers surged as Trump signaled support for companies relocating production to the U.S.:

  • Ford: +4.1%

  • GM: +3.5%

  • Stellantis: +5.6%

Fed Caution and Bond Yields

Fed Governor Christopher Waller cautioned that the new tariff policy could pose one of the most significant economic shocks in decades. If the economy weakens, he may support rate cuts sooner than expected.

Yields fell sharply:

• 10-year Treasury: down to 4.39%

• 2-year Treasury: down to 3.86%

Other Market Movers

• Goldman Sachs rose 1.9% after strong Q1 results, citing continued market volatility.

• DaVita dropped 3% due to a ransomware incident over the weekend.

• Oil (WTI): +0.2% to $61.63/barrel

• Gold: -0.6% to $3,226.30/oz

• Silver: +1.1% to $32.24/oz

OPEC trimmed its oil demand forecast for 2025 and 2026, citing global uncertainties tied to U.S. tariffs.