Stock Futures Rise as Tariff Worries Fall
Stocks have rallied this week after President Trump announced that he had the start of a deal with NATO leaders over Greenland.
Quick overview
- The Nasdaq Composite index rose 1.18% amid a market-wide rally fueled by reduced economic and political fears.
- Tariff concerns have eased, allowing major U.S. indices like the Dow and S&P 500 to also post gains.
- Key tech stocks, including Micron Technology and Nvidia, experienced significant increases as the market rallied.
- The energy, technology, and financial sectors are leading the gains, indicating a healthy market outlook.
The Nasdaq Composite index jumped 1.18% on Wednesday as investors enjoyed a market-wide rally due to diminishing economic and political fears.
Tariff concerns are decreasing this week and allowing the stock market a chance to breathe, with the Dow up 1.21% and the S&P 500 gaining 1.16%. As Thursday morning trading began, all three major U.S. indices continued to rise, signaling at least some recovery from the week’s early declines.
Stocks dipped on Friday and then again on Tuesday as investors worried that President Donald Trump’s attempt to obtain Greenland from Denmark could lead to a lengthy trade war with tit-for-tat tariffs or even a military invasion. Those fears abated somewhat later in the week as Trump clarified that there would be no invasion and that he and NATO Secretary General Mark Rutte are working on a deal regarding Greenland.
Stocks Recover in Market Rally
The market appears to be rallying for the moment, but investors should be warned that this could be short lived. Trump has been in the habit of reversing course quickly and without much notice in the past 12 months. Key stocks like Micron Technology (MU) jumped 6.6% on Thursday in early trading. Nvidia (NVDA) added almost 3%, while Microsoft (MSFT) ticked up 0.96%.
We are seeing not just a market rally but specifically a tech rally, which is much needed after the poor performance of the tech niche during November and December last year. Further helping the market to rally is a new announcement from Trump saying that he would not impose his tariffs on European nations that were supposed to start on February 1st.
With no current concerns about heavy tariffs to deal with, the market is free to pick up its momentum from early January and continue its upward path. Now, all three major stock indices are near their record highs. The Russell 2000 small cap index rose about 2% for the day and closed at a record high.
Most of the gains that have happened across the stock market so far this week as a result of the good news have been in the energy, technology, and financial sectors. These niches have the most to gain from tariff relief, and their rise this week signals a healthy market that should continue to see gains throughout the rest of the week.
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