S&P500: 3M Earnings Drive Industrials Higher, Tech Stocks Mixed

Stocks Rise as Trump’s Tariff Comments Ease Investor Concerns

Stocks are advancing Tuesday as investors interpret President Trump’s tariff-related comments and executive actions as less aggressive than anticipated. The Dow Jones Industrial Average is up 213 points (+0.5%), while the S&P 500 and Nasdaq Composite are gaining 0.6% and 0.4%, respectively. Small-cap stocks are also performing well, with the Russell 2000 climbing nearly 1%.

Investors are reacting to Trump’s inauguration day remarks, which hinted at potential tariffs but stopped short of implementing immediate trade levies. His comments on Mexico, Canada, and China are being viewed as softer, alleviating fears of sweeping trade measures.

What Is Driving Today’s Gains?

Corporate earnings are fueling market optimism. 3M is up over 4% after surpassing profit expectations, supported by strong sales in adhesives, tapes, and electronics. D.R. Horton is gaining 4.5% after reporting better-than-expected fiscal fourth-quarter results. Moderna shares are rising 3.9%, boosted by news of $590 million in government funding for its bird flu vaccine development.

Big technology stocks are also contributing, with Amazon and Nvidia each advancing over 1%. However,  Apple is slipping nearly 2% after Jefferies downgraded the stock, citing concerns over its AI outlook and potential revenue shortfalls in its upcoming earnings report.

How Are Sectors Performing?

The industrials sector is leading gains in the S&P 500, up 1.51%, as earnings from companies like 3M support optimism. Health care is climbing 1.47%, bolstered by Moderna’s gains. Financials and real estate are also performing well, rising 0.94% and 1.53%, respectively.

Energy stocks are lagging, down 0.3% as crude oil prices face pressure. Technology stocks are showing mixed results, with the sector down 0.39%, weighed by Apple’s weakness.

What Lies Ahead for Traders?

Market participants remain focused on Trump’s trade policies. Although his rhetoric toward Canada and Mexico appears tougher than expected, analysts at Goldman Sachs are reducing the likelihood of a universal tariff implementation, noting that trade is currently a lower priority for the administration.

Investors are also closely watching Trump’s promises of deregulation, which could benefit financials, small caps, and energy stocks. His declaration of a national energy emergency signals potential support for fossil fuel producers, though specifics remain unclear.

Looking forward, attention will turn to further developments in trade policy, corporate earnings, and macroeconomic data. Traders are particularly focused on upcoming tech earnings, including Netflix, and the Federal Reserve’s next interest rate meeting, which could shape broader market sentiment.

For more Information in our Economic Calendar.