The Dow Jones Industrial Average advanced on Tuesday as Wall Street viewed President Trump’s comments and first-day actions around international trade as a bit softer than initially feared.
The 30-stock Dow added 381 points, or 0.9%. The S&P 500 gained 0.5%, while the Nasdaq Composite ticked higher by 0.2%.
3M climbed more than 4% after earnings came in better than analysts expected. Tuesday’s rally also included small-cap names, driving the Russell 2000 more than 1% higher.
Several big technology stocks also took a leg up, with Amazon and Alphabet each gaining more than 1%. But a drop of more than 3% in Apple on the back of two Wall Street downgrades weighed on the tech-heavy Nasdaq.
Trump said he was considering 25% tariffs on Mexico and Canada on Feb. 1 because of their border policies while signing first-day executive orders in the White House Monday night. He also mentioned China, noting that the U.S. could put tariffs on the country if it doesn’t approve a TikTok deal.
Ultimately, Trump issued a broad memorandum directing federal agencies to study what he deems as unfair trade policies with foreign countries. But the president stopped short of authorizing new levies on his first day back in the Oval Office, which investors took as a sign that he may be less ardent about issuing tariffs than previously expected.
“President Trump’s Inauguration Day policy announcements on tariffs were more benign than expected,” said Alex Phillips, chief U.S. political economist at Goldman Sachs, in a note to clients. “For now, it is a lower priority than we would have expected.”
To be sure, Phillips said Trump’s language around Canada and Mexico was actually more hawkish than he anticipated. Still, the economist said he was lowering the odds that the U.S. slaps a universal tariff on all imports this year, which can offer confidence to traders originally cautious that a wide-reaching policy would reignite inflation.
Trump said he wasn’t ready for universal tariffs yet and he was vague when discussing levies on China.
Outside of trade policy, Wall Street will be focused on Trump following through on the pro-business proclamations he made throughout his campaign, most notably his calls for looser regulations that helped lift banking banking stocks following his election win in November. Other components of the so-called Trump trade — including small caps, oil stocks and bitcoin — will likely be hypersensitive to what his administration does.
In his inaugural address, the president labeled his return to the White House as the beginning of a period of growth and success for the country, while largely condemning the Biden Administration. Trump also on Monday declared a national energy emergency to increase fossil fuel production.
Small caps outperform
Small-cap stocks saw outsized gains on Tuesday as investors readied for looser business conditions under President Trump.
The small cap-focused Russell 2000 climbed more than 1% in late morning trading. By comparison, the broad S&P 500 added just 0.5%.
The Russell 2000 has climbed more than 3% in the new year, outperforming the three major indexes. This action comes as market participants expect Trump’s focus on deregulation to benefit small-cap companies.
— Alex Harring
NYSE advancers lead decliners 4-1 on Trump’s second day in office
Market breadth was strong Tuesday as Day 2 of Donald Trump’s second term kicked off, with roughly four stocks advancing for every decliner at the New York Stock Exchange. Overall, 2,063 NYSE-listed names traded higher, while another 573 pulled back.
— Fred Imbert
Apple shares fall after two downgrades
Apple shares pulled back nearly 4% after two firms downgraded the iPhone maker ahead of the opening bell.
Jefferies downgraded Apple to underperform, warning revenue could disappoint investors. Loop Capital lowered its rating to hold, citing a “material iPhone demand reduction” ahead of the iPhone 17.
The rating changes are a rare show of pessimism for Apple, which remains a consensus buy on the Street. According to the CNBC Analyst Consensus Tool, 32 out of 47 analysts consider the tech company a buy or a strong buy.
— Sarah Min
Stocks open higher
Stocks kicked off Tuesday’s trading session in the green as investors considered the first-day actions from President Trump.
The Dow traded up about 0.4% shortly after 9:30 a.m. ET. The S&P 500 and Nasdaq Composite each added about 0.5%.
— Alex Harring
Jefferies downgrades Mondelez on cocoa supply risks
Jefferies analyst Rob Dickerson downgraded food stock Mondelez to hold from buy, saying in a note to clients that the global cocoa supply is facing another weak harvest that could hurt the company.
“Our work and knowledge base on cocoa makes us more cautious on MDLZ than we were in ’24, given higher likelihood of structural supply issues that limits safety stock and shorter-duration buying needs that keep prices elevated for longer,” the note said.
The higher price of cocoa could result in lower earnings for Mondelez, but it could also lead to better sales for other snack categories, Dickerson said.
“After high inflation in ’21-’23, price growth for many food categories slowed, yet chocolate continued to inflate with ’24 pricing up ~5% y/y, widening price gaps to other snacking categories,” the note said.
Shares of Mondelez are down more than 3% in January.
— Jesse Pound
Stocks making the biggest moves before the bell: Apple, Qorvo and more
These are the stocks moving the most in premarket trading:
- Apple — Shares slipped nearly 2% after Jefferies downgraded the iPhone maker to an underperform rating from hold.
- Qorvo — The chipmaker moved 2% higher on the back of an upgrade at Morgan Stanley to overweight from equal weight.
- 3M — The industrial stock jumped 4% after the industrial giant reported fourth-quarter earnings that beat expectations, boosted by higher sales of industrial adhesives, tapes and electronics.
Read the full list of stocks moving here.
— Lisa Kailai Han
3M shares jump 5% after strong earnings
Shares of 3M jumped nearly 5% in premarket after the industrial firm reported fourth-quarter earnings that beat expectations. The results were boosted by higher sales of industrial adhesives, tapes and electronics during the holiday quarter.
3M reported adjusted profit of $1.68 per share, above analysts’ average estimate of $1.66 per LSEG. Adjusted revenue of $5.81 billion came in above estimates of $5.78 billion.
— Yun Li
D.R. Horton shares pop on earnings
Homebuilder D.R. Horton climbed in Tuesday’s premarket after earnings topped Wall Street expectations.
The company earned $2.61 per share on $7.61 billion in revenue for the first fiscal quarter. Analysts polled by LSEG were expecting just $2.36 a share and $7.08 billion, respectively.
Shares have jumped more than 5% since 2025 began, reversing course after sliding 8% in the prior year.
— Alex Harring
China vice premier warns: Trade war has no winners
Chinese Vice Premier Ding Xuexiang warned Tuesday that trade wars end with “no winners” after President Donald Trump took office for a second term — raising the possibility of increased trade tensions between the world’s two largest economies.
Ding’s comments came during a speech at the World Economic Forum in Davos, Switzerland.
— Evelyn Cheng
Stock futures give up some ground after President Trump’s tariff comments
Stock futures gave up earlier gains on Monday night, after President Trump said he was considering implementing a 25% tariff on Mexico and Canada beginning on Feb.1. He added that he would also place tariffs on China if Beijing refuses to approve a deal to sell TikTok.
— Brian Evans
Jefferies downgrades Apple
Jefferies downgraded Apple to underperform, a rare negative rating for the Big Tech name on Wall Street.
The firm also warned that revenue out of the company can disappoint investors. CNBC Pro subscribers can click here for the full story.
— Alex Harring
Costco union members vote to authorize strike
A union representing more than 18,000 Costco employees nationwide approved a strike if a contract agreement with the retailer cannot be reached.
Costco Teamsters said 85% of members voted to approve a work stoppage. Union members held practice pickets last week.
“Costco’s greedy executives have less than two weeks to do the right thing,” Sean O’Brien, general president of Teamsters, said in a statement. “If they refuse, they’ll have no one to blame but themselves when our members go on strike.”
The union said it will have one final week of negotiations with the retailer. The current contract expires Jan. 31.
— Alex Harring
Stock futures rise
U.S. stock futures were higher on Monday, following the inauguration of President Donald Trump.
Futures tied to the S&P 500 advanced 0.4%, alongside Nasdaq 100 futures. Dow Jones Industrial Average futures popped 187 points, or 0.4%.
— Brian Evans
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