Major U.S. stock indexes slipped to interrupt their four-session winning streak, but they still managed to notch their second consecutive weekly gain after President Donald Trump softened his tone on tariffs, and called for lower rates of interest and cheaper oil in his first week back within the White House.
Trump suggested 25% duties on Canada and Mexico on Feb. 1, which is later than his prior pledge to initiate tariffs on his first day. He also mentioned tariffs of only 10% on all Chinese imports, which could be considerably lower than the 60% he proposed on the campaign trail.
“This has left investors with the sensation that not only are his tariff plans likely lower down on the priority list, but they might find yourself being far less aggressive than initially feared,” said Matthew Ryan, head of market strategy at global financial services firm Ebury.
Further fueling stock gains, Trump told world leaders gathered in Davos, Switzerland on Thursday he would demand lower rates of interest and ask Saudi Arabia and other oil-producing countries to chop the price of oil. Oil fell 0.09% to $74.55 per barrel.
The broad S&P 500 ended down 0.29%, or 17.47 points, to six,101.24, below its record close on Thursday of 6,118.71 and intraday record of 6,128.18 reached near the open. The blue-chip Dow fell 0.32%, or 140.82 points, to 44,424.25, and the tech-heavy Nasdaq inched lower 0.5%, or 99.38 points, to 19,954.30. The benchmark 10-year Treasury yield dipped to 4.617%.
Although Trump said he would “demand” lower rates of interest, the Federal Reserve is in command of monetary policy and customarily works independently inside government.
The Fed’s slated to fulfill next week and make a policy announcement on Wednesday. After a string of strong data, including a blowout December jobs report, almost nobody expects the Fed to lower rates, in response to the CME’s FedWatch tool that tracks what the market thinks are the percentages of a rate move.
The Fed’s short-term benchmark fed funds goal is 4.25% to 4.5%.
With tariffs on the back burner of investors’ minds for now, they’ll turn their attention back to corporate news, especially earnings. Among the day’s top company news includes:
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Verizon’s earnings within the last three months of last yr beat analysts’ expectations. The wireless provider also saw its best postpaid phone subscriber growth in five years, surprising analysts. Shares closed up nearly 1%.
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Novo Nordisk shares rallied about 8.5% on positive early-stage results for its once weekly amycretin obesity drug.
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Twilio issued a stronger-than-expected earnings outlook, and its shares jumped 20%
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Texas Instruments warned its first-quarter profits would miss analysts’ forecasts because it contends with inventory buildup in its key automotive and industrial markets. Shares ended down 7.5% for its worst day since March 2020.
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CSX shares declined nearly 3% after the transport company said its fourth-quarter results dropped as a consequence of sharp declines in coal and fuel surcharge revenue.
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Intuitive Surgical stock slumped 4.4% for its worst day since October 2023 after the corporate cut its gross profit margin outlook.
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Last night, Boeing warned of a larger-than-forecast fourth-quarter loss as a consequence of a prolonged strike, charges related to U.S. government projects and expenses linked to a slew of job cuts. Shares shed 1.37%.