Wall Street Surges As Trump Tariffs Take Effect/ Newslooks/ WASHINGTOn/ J. Mansour/ Morning Edition/ Wall Street rebounded Thursday as President Trump’s new tariffs officially took effect on dozens of countries. The S&P 500 flirted with record highs, buoyed by strong corporate earnings and optimism around interest rate cuts. Global markets remained largely steady, reflecting investor confidence despite ongoing trade tensions.
Wall Street + Quick Looks
- Market Reaction: S&P 500 rose 0.6%, Dow +182 points, Nasdaq +1.1%.
- Tariffs Implemented: New Trump tariffs take effect on dozens of countries Thursday.
- Investor Optimism: Rate-cut hopes and strong earnings offset tariff concerns.
- Global Markets: Europe and Asia indexes rose, with China reporting export growth.
- Apple Boosts Confidence: Stock rose 3.1% after $100B U.S. investment announcement.
- Fed Outlook: Interest rate cuts likely as inflation pressures stabilize.
- Labor Market: Unemployment claims rose slightly, but no signs of recession.
- Big Movers:
- Duolingo +31.8%
- DoorDash +3%
- Eli Lilly -13.9%
- Intel -1.7% after Trump calls for CEO’s resignation
- International Response: Toyota dips, Sony gains as Japan adjusts to U.S. tariff policies.
Deep Look
Wall Street Rallies as Investors Brush Off Trump Tariffs; Global Markets Follow Suit
NEW YORK – August 7, 2025
Wall Street posted gains on Thursday even as President Donald Trump’s sweeping new tariffs officially went into effect on exports from dozens of countries. Despite earlier concerns, the markets appeared largely undeterred, signaling confidence in the strength of the U.S. economy.
The S&P 500 rose 0.6%, edging closer to the record high it set last month. The Dow Jones Industrial Average added 182 points, while the Nasdaq climbed 1.1%, buoyed by tech stocks and solid corporate earnings.
Rate Cuts and Resilient Earnings Bolster Market Confidence
Though anxiety about the economic toll of tariffs remains—especially following a weaker-than-expected U.S. jobs report last week—investors were heartened by expectations that the Federal Reserve may soon lower interest rates. Lower rates generally support borrowing, investing, and corporate growth.
Economists also pointed to improved productivity data, suggesting that the U.S. economy might continue expanding without additional inflationary pressures. This comes as Trump’s tariffs, designed to boost domestic manufacturing, threaten to drive up consumer prices for everyday goods.
In Europe, the Bank of England preemptively cut interest rates to support its struggling economy, reinforcing the global trend toward monetary easing.
Trump’s Tariffs: Known but Not Feared—Yet
The tariffs that took effect Thursday were already priced in, many analysts said. They were less severe than previously threatened, offering relief to markets. Some countries are still negotiating exemptions, adding uncertainty—but also hope for resolution.
Yet, critics argue that Wall Street’s rebound could be premature or inflated, given the rapid recovery from the April low. High asset valuations are raising concerns about whether the market has gotten ahead of economic reality.
“It’s survival of the biggest,” said Brian Jacobsen of Annex Wealth Management, noting that large, cash-rich companies like Apple are best positioned to weather Trump’s trade war.
Apple and Tech Lead the Rally
Apple shares jumped 3.1% after CEO Tim Cook joined Trump at the White House to announce an additional $100 billion investment in U.S. manufacturing. The announcement is part of a broader effort by tech giants to avoid the brunt of Trump’s 100% tariff on imported computer chips.
“If you’re building in the United States of America, there’s no charge,” Trump said, adding pressure on companies to onshore production.
Other winners included DoorDash (+3%), which beat earnings expectations, and Duolingo, whose shares skyrocketed 31.8% on surging subscription revenue.
Not All Positive: Intel and Eli Lilly Slide
Shares of Intel dropped 1.7% after Trump called for the resignation of CEO Lip-Bu Tan, citing alleged ties to Chinese military-linked companies—though he provided no evidence. The comments raised questions about political interference in corporate governance.
Meanwhile, Eli Lilly’s stock plunged nearly 14%, despite beating profit expectations, after investors reacted negatively to clinical trial results for a pill version of its popular weight-loss drug, Zepbound.
Global Markets Echo U.S. Resilience
Overseas markets generally mirrored Wall Street’s gains:
- Shanghai +0.2%, Hong Kong +0.7% — buoyed by improved Chinese exports.
- Japan’s Nikkei 225 +0.6% — despite Toyota lowering forecasts due to U.S. tariffs.
- Sony gained as it reported less-than-expected damage from U.S. trade policies.
In the bond market, Treasury yields remained steady, with the 10-year yield at 4.22%, signaling investor confidence in the Fed’s control over inflation.
You must Register or Login to post a comment.