Trump: The Catalyst for the Wall Street Movement
By Ion Jauregui - ActivTrades Analyst
Yesterday Wall Street closed in green, with the Dow Jones Industrials up 1.24% to 44,025 units, while the S&P 500 advanced 0.88% to 6,049 points and the Nasdaq rose 0.64% to close at 19,756 points. This optimism in the markets was mainly driven by expectations about President Donald Trump's future economic measures. One of the factors that generated confidence among investors was the perception that Trump's tariff policies, which include the possible imposition of 25% tariffs on Mexico and Canada as of February 1, would be more moderate than expected. This, in turn, stimulated risk appetite in the markets, encouraging a positive close for Wall Street's major indices.
Traders are likely to be particularly attentive to the president's policies related to public debt, tariffs, taxes and immigration. The U.S. economy relies heavily on steady immigration and relatively cheap labor. The cessation of this immigration flow could lead to price increases in various sectors, which would increase inflation. In addition, the mass deportation of immigrants could lead to an increase in labor demand and, therefore, a rise in wages, which would also have an inflationary impact.
On the other hand, the trade agreement between Mexico and Europe was also on investors' radar, given its potential impact on tariff dynamics and international trade. The recent renewal of the trade agreement between Mexico and the European Union could ease some of the trade tensions that had been worrying markets. This agreement strengthens economic ties between the two regions, which could partially mitigate the negative effects of the tariffs imposed by Trump. At the same time, it improves the outlook for European and Mexican companies that depend on smooth trade, which ultimately benefits global investors as well.
On the corporate front, the shares of some of the major technology companies benefited from the good market climate. Nvidia (NVDA) and Amazon (AMZN) rose 2%, while Alphabet (GOOGL) advanced 1%. However, Apple (AAPL) experienced a 3% drop after receiving a downgrade from two analyst firms. By sectors, industrials (+2.03 %) and real estate (+1.83 %) led the gains, while the energy sector closed negative with a 0.64 % drop. Among the 30 largest listed companies in the Dow Jones, 3M (MMM) and Caterpillar (CAT) were the main gainers, with increases of 4.16 % and 3.58 %, respectively.
In the commodities markets, US WTI fell by 2.5 % to 75.89 dollars per barrel, while gold rose to 2,757 dollars per ounce. The euro maintained its exchange rate at 1.0427 dollars.
In summary, investor optimism on Wall Street was driven by the expectation that Donald Trump's economic policies, especially regarding tariffs and immigration, could be less stringent than anticipated. In addition, the renewal of the trade agreement between Mexico and the European Union brought an additional dose of stability to the market. However, risks stemming from the uncertainty surrounding these policies remain a key variable to follow in the coming weeks.
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The information provided does not constitute investment research. The material has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and such should be considered a marketing communication.
All information has been prepared by ActivTrades ("AT"). The information does not contain a record of AT's prices, or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information.
Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not reliable indicator of future performance. AT provides an execution-only service. Consequently, any person acing on the information provided does so at their own risk.
Yesterday Wall Street closed in green, with the Dow Jones Industrials up 1.24% to 44,025 units, while the S&P 500 advanced 0.88% to 6,049 points and the Nasdaq rose 0.64% to close at 19,756 points. This optimism in the markets was mainly driven by expectations about President Donald Trump's future economic measures. One of the factors that generated confidence among investors was the perception that Trump's tariff policies, which include the possible imposition of 25% tariffs on Mexico and Canada as of February 1, would be more moderate than expected. This, in turn, stimulated risk appetite in the markets, encouraging a positive close for Wall Street's major indices.
Traders are likely to be particularly attentive to the president's policies related to public debt, tariffs, taxes and immigration. The U.S. economy relies heavily on steady immigration and relatively cheap labor. The cessation of this immigration flow could lead to price increases in various sectors, which would increase inflation. In addition, the mass deportation of immigrants could lead to an increase in labor demand and, therefore, a rise in wages, which would also have an inflationary impact.
On the other hand, the trade agreement between Mexico and Europe was also on investors' radar, given its potential impact on tariff dynamics and international trade. The recent renewal of the trade agreement between Mexico and the European Union could ease some of the trade tensions that had been worrying markets. This agreement strengthens economic ties between the two regions, which could partially mitigate the negative effects of the tariffs imposed by Trump. At the same time, it improves the outlook for European and Mexican companies that depend on smooth trade, which ultimately benefits global investors as well.
On the corporate front, the shares of some of the major technology companies benefited from the good market climate. Nvidia (NVDA) and Amazon (AMZN) rose 2%, while Alphabet (GOOGL) advanced 1%. However, Apple (AAPL) experienced a 3% drop after receiving a downgrade from two analyst firms. By sectors, industrials (+2.03 %) and real estate (+1.83 %) led the gains, while the energy sector closed negative with a 0.64 % drop. Among the 30 largest listed companies in the Dow Jones, 3M (MMM) and Caterpillar (CAT) were the main gainers, with increases of 4.16 % and 3.58 %, respectively.
In the commodities markets, US WTI fell by 2.5 % to 75.89 dollars per barrel, while gold rose to 2,757 dollars per ounce. The euro maintained its exchange rate at 1.0427 dollars.
In summary, investor optimism on Wall Street was driven by the expectation that Donald Trump's economic policies, especially regarding tariffs and immigration, could be less stringent than anticipated. In addition, the renewal of the trade agreement between Mexico and the European Union brought an additional dose of stability to the market. However, risks stemming from the uncertainty surrounding these policies remain a key variable to follow in the coming weeks.
*******************************************************************************************
The information provided does not constitute investment research. The material has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and such should be considered a marketing communication.
All information has been prepared by ActivTrades ("AT"). The information does not contain a record of AT's prices, or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information.
Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not reliable indicator of future performance. AT provides an execution-only service. Consequently, any person acing on the information provided does so at their own risk.
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