US stocks rose on Tuesday, driven by optimism over a potential trade breakthrough between the US and China, as well as an energy sector boost. The Dow Jones Industrial Average (DJI) gained 0.3%, while the S&P 500 and Nasdaq Composite indexes rose 0.72% and 1.35%, respectively.
The news of US President Donald Trump delaying tariffs for Canada and Mexico sparked hopes that a trade deal could be reached, despite China’s counter-measures with levies on US goods. Energy stocks led the gains, rising 2.18%.
Strong corporate earnings also contributed to investor optimism. The majority of S&P 500 companies reported above analyst expectations, with some notable exceptions including Alphabet (GOOGL) and PepsiCo (PEP), which fell after weak earnings forecasts.
However, not all was positive news. China’s “unreliable entity list” included several US companies, including PVH Corp, which slipped nearly 1%. Biotechnology firm Illumina (ILMN) also dropped 5.3% after announcing job cuts.
Despite the mixed results, investors remained optimistic about the trade situation and earnings performance. As one analyst noted, “investors have been breathing a sigh of relief today and we’ll see if a month from now they can continue to breathe that sigh of relief.”
Source: https://www.reuters.com/markets/us/futures-tick-lower-china-responds-us-tariffs-2025-02-04