US stocks closed higher on Tuesday, shrugging off trade war rhetoric as investors waited to see how China would retaliate against President Donald Trump’s 10% tariff on all Chinese goods. The S&P 500 index rose 0.72%, or 43.31 points, to 6,037.88, while the Dow gained 0.3%, or 134.13 points, to 44,556.04.
China retaliated against Trump’s tariffs by slapping duties of up to 15% on US imports of coal and liquefied natural gas, as well as higher duties on crude oil, farm equipment, and selected cars. However, the news had little impact on markets, which were instead focused on company earnings reports.
Google parent Alphabet reported weaker-than-expected sales in its cloud-computing business, causing shares to tumble 6.71% after hours trading. PepsiCo also reported mixed quarterly results, with earnings beating estimates but sales missing due to waning demand for snacks and drinks in North America.
Meanwhile, PayPal beat analysts’ earnings expectations, while Merck’s stock slipped despite beating earnings estimates due to a decline in 2025 sales guidance. Palantir shares soared 24% after the software company topped analyst estimates, while Amazon will report its quarterly results on Wednesday.
The US-China trade war remains uncertain, with Trump set to talk to Chinese President Xi Jinping about pausing tariffs. However, some analysts believe that investors are becoming increasingly skeptical of a full-blown trade war, given the market’s resilience in recent volatility.
Source: https://eu.usatoday.com/story/money/markets/2025/02/04/us-stock-market-china-tariffs-impact-tuesday/78206615007