On February 15, 2025 (Thursday), the U.S. stock market showed strong performance, with the S&P 500 Index closing higher, primarily boosted by the robust performance of Nvidia, Apple, and Tesla. The Trump administration announced plans to impose reciprocal tariffs on U.S. trade partners, which was met with a positive market reaction, easing investor sentiments.
President Trump's trade team is delving into the bilateral tariffs and trade relationships between the U.S. and other countries, with plans to match U.S. tariffs with the high tariffs imposed by other countries. A White House official revealed that the tariffs could be officially implemented within weeks. This news further heightened market focus on trade relations.
Meanwhile, U.S. economic data sent moderate signals. According to the latest figures, U.S. producer prices rose in January, but key factors in the core Personal Consumption Expenditures (PCE) index closely monitored by the Federal Reserve showed moderate performance, with some price increases even retreating. Spending in areas such as healthcare either remained flat or only slightly increased. Healthcare, which accounts for nearly 20% of the core PCE, saw a decline of 0.06%. These figures indicate eased inflation pressures, boosting investor confidence in a slowing economy.
After the report was released, the yield on the 10-year U.S. Treasury note fell significantly, demonstrating growing investor confidence in cooling inflation, which further fueled stock market gains. Tesla's stock surged 5.9%, Nvidia climbed 3.2%, and Apple rose 2%. The strong performance of these tech stocks pushed the S&P 500 Index slightly closer to the historical closing record high set on January 23.
Cresset Capital Chief Investment Officer Jack Ablin noted that stock market investors are taking cues from the bond market, remaining vigilant about potential high inflation data. Meanwhile, the Chicago Mercantile Exchange's (CME) FedWatch tool indicated that the interest rate futures market expects the Federal Reserve to cut rates by 25 basis points by the end of 2025, which also supported stock market gains.
In addition, the latest labor market report was also positive, with the number of new jobless claims in the U.S. decreasing last week, indicating that the job market remains resilient. Shares of oil giant Chevron rose 0.6% following the company's announcement of plans to lay off up to 20% of its global workforce by the end of 2026.
Overall, the stock market's rise was influenced by multiple factors, with optimistic expectations regarding Trump's tariff policy, inflation data, and the labor market providing confidence to investors.
