Dow Jones Industrial Average futures turned negative on Thursday after former President Donald Trump announced that tariffs on Canada, Mexico, and China would proceed as planned. The Dow futures dropped by 26 points, or 0.06%, following the announcement, although losses were mitigated by Nvidia’s stock surge after the company reported better-than-expected quarterly results. Futures tied to the S&P 500 and Nasdaq 100 gained 0.4% and 0.7%, respectively, supported by Nvidia’s performance.
Trump stated on Truth Social that a 25% tariff on Mexico and Canada would take effect on March 4 due to insufficient efforts to curb drug trafficking across borders. Additionally, a 10% tariff on China will be added to the existing 10% levy. Nvidia’s shares rose 1.8% after the company exceeded fourth-quarter revenue and earnings estimates, alleviating concerns about a slowdown in the AI sector. The company’s strong guidance highlighted ongoing demand driven by artificial intelligence advancements. Other tech stocks, including Broadcom and Tesla, also climbed approximately 2.3% each.
Analysts noted Nvidia’s impressive 78% year-over-year revenue growth, underscoring robust demand for AI infrastructure despite decelerating growth. However, market sentiment was dampened by a rise in jobless claims, which added to recent concerns about economic softening. Initial jobless claims for the week ending Feb. 22 reached 242,000, surpassing the Dow Jones estimate of 225,000. This follows weaker-than-expected consumer confidence, retail sales, and sentiment readings, raising worries about the U.S. economy’s health.
Investors are now focused on the upcoming personal consumption expenditures price index, the Federal Reserve’s preferred inflation gauge, for further insights.
— news from CNBC