Stocks ended higher Thursday as President Donald Trump said he plans to introduce reciprocal tariffs but delayed their implementation until April.
The Dow Jones Industrial Average surged 342.87 points, or 0.77%, to end the session at 44,711.43, while the S&P 500 gained 1.04% to 6,115.07, and the tech-heavy Nasdaq rose 1.50% to 19,945.64.
Trump rolled out his plan to increase U.S. tariffs to match the tax rates that other countries charge on imports, the Associated Press reported, possibly triggering a broader economic confrontation with allies and rivals alike as he hopes to eliminate any trade imbalances.
“I’ve decided for purposes of fairness that I will charge a reciprocal tariff,” Trump said in the Oval Office at the proclamation signing. “It’s fair to all. No other country can complain.”
Adam Turnquist, chief technical strategist for LPL Financial, said that equity markets are off to a solid start in 2025.
“Despite an array of headline risks, the S&P 500 has climbed over 3% on the year and even notched a record high last month,” he said.
Turnquist noted that the inflation battle is not over, adding that stocks are pricing in a lot of good news, and the policy landscape is tenuous.
"With more tariffs and retaliation likely, alongside government spending constraints that may make it difficult to extend the Trump tax cuts from 2017, we expect modest gains in stocks over the balance of the year with more ups and downs compared to 2024," he said.
Updated at 12:26 PM EST
Meta's mega run
Meta Platforms (META) shares are on pace to snap an 18 day winning streak, one of the longest on record for a megacap tech stock, with shares edging 0.6% lower in early afternoon trading.
The Facebook and Instagram parent is sill up more than 20% for the year, and 36.4% over the past six months, well outpacing any advance for its Magnificent 7 peers. The group has added nearly $260 billion in value since its winning streak began on January 16.
meta declined to provide a full-year revenue forecast following its stronger-than-expected fourth quarter earnings on January 29, but pegged first quarter sales just below Wall Street estimates.
META Insider Trading Alert 🚨
— Barchart (@Barchart) February 13, 2025
Mark Zuckerberg has unloaded $457 Million worth of $META shares during the stock's historic 18-day winning streak pic.twitter.com/i0dapi9Eho
Updated at 11:08 AM EST
Dovish hopes?
A pullback in Treasury bond yields is helping stocks extend their early gains, thanks in part to a dovish read of the January PPI report that could tame some of the market's concern for new tariff announcements later this afternoon.
"Components of the PPI that reliably lead the CPI data paint a reassuring picture," said Samuel Tombs chief US economist at Pantheon Macroeconomics. "We calculate from the PPI and CPI data that the core PCE deflator increased by 0.28% in January, much less than the 0.50% increase a year ago."
Benchmark 2-year Treasury note yields were last marked 3 basis points lower on the session at 4.309% while 10-year notes fell 7 basis points to 4.537%.
The S&P 500, meanwhile, was last marked 36 points, or 0.61% higher on the day, with the Nasdaq up 205 points, or 1.04%.
GS: PPI Above Expectations but Details Softer;
— Mike Zaccardi, CFA, CMT 🍖 (@MikeZaccardi) February 13, 2025
Revising January Core PCE Down to 30bp; Initial Claims in Line pic.twitter.com/9A2BK97hE6
Updated at 9:35 AM EST
Optimistic open
The S&P 500 was marked 14 points, or 0.24% higher in the opening minutes of trading, with the Nasdaq rising 103 points, or 0.52%.
The Dow, meanwhile, added 68 points with the mid-cap Russell 200 rising 12 points, or 0.56% following the hotter-than-expected factory gate inflation data.
"PPI confirmed yesterday’s hot CPI, and along with another low jobless claims number, we continue to see a picture that doesn’t include Fed rate cuts anytime soon," said Chris Larkin, managing director for trading and investing at E*TRADE from Morgan Stanley.
S&P 500 Opening Bell Heatmap (Feb. 13, 2025)$SPY +0.16% 🟩$QQQ +0.31% 🟩$DJI +0.32% 🟩$IWM +0.57% 🟩 pic.twitter.com/LQLQICHKLK
— Wall St Engine (@wallstengine) February 13, 2025
Updated at 8:35 AM EST
More hot inflation
Factory gate inflation rose at a faster-than-expected pace last month, Commerce Department data indicated, with the final demand reading rising 0.4% on the month and 3.5% on the year, the hottest in nearly two years.
Even taking away volatile food and energy costs, the year-on-year reading was pegged at 3.6%, well ahead of Wall Street's 3.3% forecast.
Weekly jobless claims, meanwhile, fell by 7,000 last week to 213,000, just inside Wall Street's 215,000 forecast.
Stocks turned higher following the data release, with futures tied to the S&P 500 indicating a 9 point bump and the Nasdaq extending its premarket gain to around 65 points, as investors parsed positive details from the report that feed into the Fed's preferred PCE inflation gauge.
Benchmark 2-year notes were marked 2 basis points higher at 4.361% while 10-year notes were trading at 4.617%.
US PPI prints 0.4% m/m (3.5% y/y), confirming the inflation uptick seen in yesterday's CPI report.
— Matt Weller CFA, CMT (@MWellerFX) February 13, 2025
Core PPI was 0.3% m/m (3.6% y/y)
The US Dollar Index $DXY is little changed below 1.0800 in the initial reaction. pic.twitter.com/FE4pK44LLn
Updated at 8:11 AM EST
Deere not running
Deere & Co (DE) share slumped lower in early trading after the world's biggest farm equipment marker posted a disappointing set of first quarter earnings and fretted over the impact of tariffs on its global business.
Deere said revenues for the three months ending in December, its fiscal first quarter, fell 35% from the year-ago period to $6.81 billion, and sale sales for its biggest division are likely to fall by as much as 20% over the coming financial year.
“Deere’s performance in the first quarter highlights our continued focus on optimizing inventory levels of both new and used equipment amidst the uncertain market conditions our customers are facing,” said CEO John May. “We’re seeing compelling evidence that our efforts are positioning the company to successfully navigate the current environment.”
Deere shares were marked 5.15% lower in premarket trading to indicate an opening bell price of $452.01 each.
$DE just wow. pic.twitter.com/hLFTpoPFMK
— David Nicoski CMT (@davevermilion) February 13, 2025
Updated at 7:01 AM EST
The big one
President Trump posted on his verified social media account Thursday that he is reading to announce so-called 'reciprocal' tariffs on countries that charge duties on U.S. exports.
The post pared U.S. stocks in premarket trading, with futures contracts tied to the S&P 500 now indicating a 3 point opening bell decline and those linked to the Nasdaq priced for a 15 point gains
"In 2018, Canada imposed dollar-for-dollar retaliation on 16.6 billion in Canadian dollars in U.S. steel, aluminum and other imports, deliberately targeting products from red states like Florida orange juice and Wisconsin cheese," said Chrystia Freeland, Canada's former Deputy Prime Minister in a guest essay in today's New York Times.
"Mr. Trump may not care much about the objections of people in Canada — or Mexico or the European Union or South Korea — but he does care about American workers and businesses," she added. "If exporters feeling the squeeze from tit-for-tat tariffs start calling the White House, the pressure on the administration to reverse course will grow."
US Pres. Trump: Today Is The Big One: Reciprocal Tariffs!!! Make America Great Again!!!https://t.co/oKEtlC7saw pic.twitter.com/iIAf6i1ZxR
— LiveSquawk (@LiveSquawk) February 13, 2025
Stock Market Today
President Donald Trump held phone calls with Russia President Vladimir Putin and Ukraine’s President Volodymyr Zelenskiy yesterday, telling reporters that both leaders are willing to begin discussions to end the conflict that has cost more than a million lives.
“We expect that he’ll come here, and I’ll go there and we’re going to meet also probably in Saudi Arabia the first time,” Trump told reporters in Washington of an as-yet confirmed meeting with Putin. “We’ll meet in Saudi Arabia, see if we can get something done.”
The prospect of talks, while vague, triggered a rally in risk assets overnight, pushing the U.S. dollar index 0.33% lower to 107.587 and sparking solid rallies in Japan, Asia and European markets.
Stocks in the U.S., however, are set for a more muted open following yesterday's hotter-than-expected January CPI data, which has all but erased bets on a 2025 Federal Reserve rate cut.
Heading inflation rose to the highest monthly level since August of 2023, with core reading also rising amid soaring shelter, insurance and used car prices.
The Commerce Department will publish its January estimate of producer price inflation at 8:30 am Eastern time, with economists focused on components of the reading that feed into the Fed's preferred PCE inflation gauge, which will be released later this month.
Benchmark 2-year Treasury bond yields were last trading at 4.342%, down 2 basis points from last night's close, ahead of today's PPI reading and the Labor Department's weekly jobless claims data.
Related: CPI inflation shock hammers Fed rate cut bets for 2025
A market inflation gauge, meanwhile, which tracks the difference between 2-year inflation-protected bonds and benchmark 2-year notes, rose to the highest levels since the summer of 2022 in overnight trading.
Investors are also focused on the potential for an announcement of new 'reciprocal' tariffs on goods from nations that charge duties on U.S. exports, which could come from the White House later today following a visit from India Prime Minister Narendra Modi.
"Key sectors to watch for potential exemptions include the automotive and pharmaceutical industries," said ActivTrades Analyst Anderson Alves. "Any aggressive tariff announcement targeting key sectors could impact U.S. Treasury yields and the U.S. dollar, potentially dragging risk assets lower across global markets.”
On Wall Street, stocks are set for a modestly firmer open following on from last night's selloff, with the S&P 500 called 1 point higher and the Dow Jones Industrial Average priced for a 10 point advance.
The tech-focused Nasdaq, meanwhile, is indicated 35 points higher with Nvidia (NVDA) , Super Micro Computer (SMCI) , Tesla (TSLA) and Intel (INTC) the most active stocks in premarket trading.
Related: Analyst revisits Intel stock forecast amid surprise plans for a key spinoff
In overseas markets, the prospect of an end to the war in Ukraine, as well as the potential for a massive U.S. aid plan to rebuild the nation, helped lift Europe's Stoxx 600 to a fresh all-time high in early Frankfurt trading, with the regional benchmark last seen 0.5% higher and just a point off its earlier peak.
More Wall Street Analysis:
- Goldman Sachs analysts warn on Trump tariff impact for stocks
- Analyst predicts stocks likely to join the S&P 500 in 2025
- Every major Wall Street analyst's S&P 500 forecast for 2025
In Britain, the FTSE 100 fell 0.74% in London as global oil prices eased in the wake of the Russia-Ukraine talks reports and the pound rose to 1.2502 against the dollar following a better-than-expected reading for fourth quarter GDP from the Office for National Statistics.
Overnight in Asia, Japan's Nikkei 225 rose 1.78% in Tokyo as a weaker yen supported export stocks, while the regional MSCI ex-Japan benchmark rose 0.15% into the close of trading.
Related: Veteran fund manager issues dire S&P 500 warning for 2025
