Business
Stocks Rise Amid Trump’s Tariff Announcement on Chips
NEW YORK, U.S. — U.S. stocks rose on Thursday as the tech-heavy Nasdaq gained 0.3% following President Donald Trump‘s announcement of new tariffs on chips and semiconductors, which includes an exemption for companies manufacturing in the United States.
The Dow Jones Industrial Average, however, fell 288 points or 0.7%, pulled down by a 2% decrease in shares of a major construction equipment manufacturer that announced weak business projections. Despite this, shares of companies like Nvidia and Apple saw upward moves of more than 1% and 3% respectively after Trump revealed plans that could benefit their domestic operations.
“We’re going to be putting a very large tariff on chips and semiconductors,” Trump stated during a press conference in the Oval Office. “But the good news for companies like Apple is if you’re building in the United States or have committed to build, there will be no charge.”
Market reactions to Trump’s tariffs have been mixed, displaying optimism as investors look beyond the immediate tariff implications. “There’s a lot to digest around tariffs and trade right now,” said Anthony Saglimbene, chief market strategist at Ameriprise. “The market is concentrating on what it can discount right now, which is still a firm economic backdrop and strong earnings.”
Recent economic indicators suggest a robust U.S. economy, with S&P 500 earnings on track to grow by 11% in the second quarter versus last year, nearly triple the growth rate from earlier predictions.
On a positive note, communication stock CommScope saw a more than 87% surge earlier in the week after announcing a major sale of a subsidiary, further energizing investor sentiment. Conversely, Crocs shares plummeted over 25% on news they pulled their full-year outlook amid a challenging economic environment.
The Federal Reserve’s decision last week to keep interest rates steady may also have influenced market behavior, with Waller’s nomination as the next chair of the Fed seen as a potential shift in monetary policy direction.
Following the day’s trading, the S&P 500 is up 1.6% for the week while the Nasdaq has added nearly 3%. As the week continues, investors will keep a close eye on further developments concerning the tariffs and their potential impact on the economy.
