US stocks opened higher on Tuesday as traders reacted to a series of executive orders issued by President Donald Trump in the first full day of his second term. The market saw a positive trend with the Dow rising by 170 points (0.39%), the S&P 500 increasing by 0.49%, and the Nasdaq Composite moving higher by 0.52%.
During an Oval Office signing ceremony on Monday, President Trump announced a 25% tariff on Mexico and Canada starting February 1. Notably, there was no mention of tariffs on China, the largest trade partner of the US. When asked about tariffs on China, Trump highlighted the existing tariffs from his first term that were still in place after President Joe Biden's administration largely maintained them.
Trump hinted at the possibility of imposing tariffs on China if Beijing did not approve a deal regarding TikTok, which is facing a potential ban in the US over national security concerns and implications for the First Amendment.
The US dollar, which had been strengthening in anticipation of Trump's second term, remained relatively stable on Tuesday morning following the news of the proposed tariffs. Analysts at Morgan Stanley emphasized the need for caution, stating that Trump's focus on tariffs as early as February 1 serves as a reminder for markets to stay vigilant and monitor the rapid pace of policy decisions being made.
