Dow Jones Rises After Trump Tariff Comments; Nvidia Rallies But Tesla, Apple Slide

The Dow Jones Industrial Average (DJIA) closed at a record high on Tuesday, achieving the milestone less than 24 hours after a tariff pledge from President-elect Donald Trump sparked fears of a panic in the stock market. The S&P 500 also closed at a record high, surging about 0.55% on Tuesday to end the day at 6,021.63. The Dow ticked up about 0.25% during the day's trading, closing at 44,860.31. The tech-heavy Nasdaq advanced about 0.60%, ending the trading session at 19,174.30.

Trading began on Tuesday hours after Trump announced plans to slap tariffs on Canada, China, and Mexico by executive order on the first day of his administration. Trump late Monday said he would charge Mexico and Canada with a 25% tariff on all products coming into the United States until action is taken by those countries to stem illegal immigration and the overflow of drugs across the border. For China, Trump said that he'd impose an additional 10% tariff on products coming to the U.S.

The major indexes were bolstered by steady performance among some major firms. Apple -- which assembles many of its products in China but enjoyed key tariff exemptions during Trump's first term -- ticked up 0.12% on Tuesday. Nvidia, the AI chipmaker that imports most of its semiconductors from Taiwan, rose 0.66% during the trading session. Tesla, the electric vehicle company led by Trump-ally Elon Musk, has a manufacturing plant in Shanghai, China. Shares of the EV maker ticked down 0.11% on Tuesday.

Investors are closely watching further moves from Trump to assess their affect on markets. JPMorgan Chase & Co. is establishing a "war room" for just this purpose. Exactly how the policy proposals will play out isn't clear yet. For example, shares of companies with tariff risks are largely shrugging off the threats for now.

One area the new administration hasn’t touched yet is cryptocurrencies, leaving that industry eagerly waiting. "We are seeing some sell the news in hot parts of the market like Tesla and crypto that were priced for more going into the inauguration," said Chris Murphy, co-head of derivatives strategy at Susquehanna International Group. "Even China stocks, which benefited from a lack of ire from Trump, have mostly reversed and are now flat on the day after near-term profit taking."

Tesla fell as much as 4.7% and was the second biggest weight on the S&P 500 Index Tuesday, while the Bloomberg Electric Vehicles Index slid as much as 1.7% after Trump directed his administration to consider removing EV subsidies and other policies that favour the vehicles. EV startups Rivian Automotive Inc. and Lucid Group Inc. also slumped.

Shares of space companies leaped on Trump’s promise to “pursue our manifest destiny into the stars” by landing American astronauts on Mars. Intuitive Machines Inc., which built and operated a moon lander that notched a historic win for private-sector space exploration, saw its stock jump as much as 23% to post its best day in months, while Rocket Lab USA Inc. and Redwire Corp. both rode double-digit gains to record highs.

Trump Media & Technology Group Corp. shares tumbled as much as 14% for their worst day since the week of the election. Trump’s social media company has been prone to wild swings, with the stock gaining 22% as recently as Jan. 13.

Trump’s tariff plans hit Canadian energy and industrial stocks, but not as badly as feared. For example, Meg Energy Corp. and Athabasca Oil Corp. are falling but still holding onto part of their gains from Monday. Similarly, shares of aircraft maker Bombardier Inc. slumped six per cent on Tuesday after rising 7.2% in the previous session. The Nasdaq Golden Dragon China Index was little changed at mid-session, as Trump hasn’t announced tariffs on Chinese goods.




In conclusion, the Dow Jones Industrial Average and other major indexes traded higher on Tuesday, as investors reacted to President Donald Trump's comments on Mexican and Canadian tariffs. Nvidia and Tesla were early winners on the stock market today, while Apple's stock ticked up slightly. However, Tesla and Apple's recent slides can be attributed to various factors, including weak earnings and delivery results, layoffs, price cuts, slowing sales, supply chain issues, and increased competition. To address these challenges, both companies are focusing on new product launches, expansion into new markets and services, and investments in emerging technologies.