Major U.S. stock indexes slipped to break their four-session winning streak, but they still managed to notch their second consecutive weekly gain after President Donald Trump softened his tone on tariffs, and called for lower interest rates and cheaper oil in his first week back in the White House.
Trump suggested 25% duties on Canada and Mexico on Feb. 1, which is later than his prior pledge to initiate tariffs on his first day. He also mentioned tariffs of only 10% on all Chinese imports, which would be considerably lower than the 60% he proposed on the campaign trail.
“This has left investors with the feeling that not only are his tariff plans likely lower down on the priority list, but they may end up being far less aggressive than initially feared,” said Matthew Ryan, head of market strategy at global financial services firm Ebury.
Further fueling stock gains, Trump told world leaders gathered in Davos, Switzerland on Thursday he would demand lower interest rates and ask Saudi Arabia and other oil-producing countries to cut the cost of oil. Oil fell 0.09% to $74.55 per barrel.
The broad S&P 500 ended down 0.29%, or 17.47 points, to 6,101.24, below its record close on Thursday of 6,118.71 and intraday record of 6,128.18 reached near the open. The blue-chip Dow fell 0.32%, or 140.82 points, to 44,424.25, and the tech-heavy Nasdaq inched lower 0.5%, or 99.38 points, to 19,954.30. The benchmark 10-year Treasury yield dipped to 4.617%.
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Although Trump said he would “demand” lower interest rates, the Federal Reserve is in charge of monetary policy and generally works independently within government.
The Fed’s slated to meet next week and make a policy announcement on Wednesday. After a string of strong data, including a blowout December jobs report, almost no one expects the Fed to lower rates, according to the CME’s FedWatch tool that tracks what the market thinks are the odds of a rate move.
The Fed’s short-term benchmark fed funds target is 4.25% to 4.5%.
With tariffs on the back burner of investors’ minds for now, they can turn their attention back to corporate news, especially earnings. Some of the day’s top company news includes:
Bitcoin prices continue to seesaw after reaching a record high ahead of Trump’s inauguration on Monday on speculation Trump would sign an executive order for a national bitcoin reserve.
Trump ended up not doing that, which has pinned bitcoin prices in a range. The cryptocurrency was last up 1.03% at $105,154.50.
On one hand, Trump has pledged to end the Securities and Exchange Commission’s crackdown on the crypto industry, and appointed crypto-friendly Paul Atkins to lead the commission. He also signed an executive order Thursday to create a crypto working group led by White House crypto and artificial intelligence czar David Sacks.
But on the other hand, all of that still falls short of the national strategic crypto reserve Trump promised, market watchers say
(This story was updated with new information.)
Medora Lee is a money, markets, and personal finance reporter at USA TODAY. You can reach her at mjlee@usatoday.com and subscribe to our free Daily Money newsletter for personal finance tips and business news every Monday through Friday morning.
