U.S. and Canadian stocks ended higher on Tuesday as investors assessed weak American consumer sentiment data and bet on a more flexible trade policy stance from the Trump administration next week.
U.S. President Donald Trump said on Monday that automobile tariffs were coming soon, while suggesting that not all proposed tariffs would be enforced in an April 2 announcement on which Wall Street is focused.
“I don’t expect that we’ll get the clarity that the market is hoping for, but investors are desperate for any sort of clarity on this front, and to the extent they’ll get some of it, it’s a huge day,” said Ross Mayfield, an investment strategist at Baird.
Weighed by worries that Trump’s tariffs would fuel inflation and hurt economic growth, the S&P 500 is down about 2% so far in 2025, and it is on track for its first quarterly loss since June 2023.
Ratings agency Moody’s said on Tuesday that the United States’ fiscal strength is on track for a continued multiyear decline as budget deficits widen and debt becomes less affordable. Another report revealed a dip in consumer confidence, with the index falling to 92.9 in March - its lowest since February 2021.
The S&P 500 climbed 0.16% to end the session at 5,776.65 points. The Nasdaq gained 0.46% to 18,271.86 points, while the Dow Jones Industrial Average rose 0.01% to 42,587.50 points. The S&P/TSX composite index ended up 35.40 points, or 0.1%, at 25,339.51, its highest closing level since Feb. 28.
“After several months of tariff headlines, interest rate and geopolitical uncertainty, many investors are sitting on the sidelines or defensively positioned,” said Brandon Michael, senior investment analyst at ABC Funds. “The fewer people positioned for upside, the more explosive the move can be when things start to turn. So we believe the recent pullback in equities is providing a great opportunity for long-term investors.”
“The positive momentum we’re experiencing could lead into April, which is historically the best month of the entire year,” Michael added.
The TSX consumer staples sector added 0.9%, helped by a gain of nearly 4% for the shares of specialty food manufacturing company Premium Brands Holdings Corp.
The materials group was up 0.7% as copper prices climbed and despite a decline in the shares of fertilizer producer Nutrien Ltd. Nutrien’s shares ended 4.8% lower as the United States said it will help restore Russia’s access to the world market for agricultural and fertilizer exports.
On Wall Street, Apple rose 1.4%, helping keep the Nasdaq in positive territory, while Nvidia slid 0.6%.
Tesla shares rose 3.45%, adding to a 12% rally the previous day. The company’s market share in Europe continued to shrink in February as sales of the all-electric car maker dropped for a second month, even as EV registrations overall on the continent grew.
KB Home fell over 6% after the homebuilder cut its full-year 2025 revenue forecast.
Of the 11 S&P 500 sector indexes, seven rose, led by communication services, up 1.43%, followed by a 0.98% gain in consumer discretionary.
Fed Governor Adriana Kugler said Tuesday that the central bank’s interest rate policy remains restrictive, but progress on bringing inflation back to the central bank’s 2% target has slowed. New York Fed President John Williams said firms and households were “experiencing heightened uncertainty” about what lies ahead for the economy.
Among a cascade of economic indicators scheduled this week, focus will be on the personal consumption expenditures price index - the Fed’s preferred inflation gauge - due on Friday.
CrowdStrike gained 3.3% after brokerage BTIG raised its rating on the cybersecurity company to “buy” from “neutral.”
Declining stocks outnumbered rising ones within the S&P 500 by a 1.3-to-one ratio.The S&P 500 posted 11 new highs and 4 new lows; the Nasdaq recorded 42 new highs and 160 new lows. Volume on U.S. exchanges was relatively light, with 13.0 billion shares traded, compared with an average of 16.4 billion shares over the previous 20 sessions.
Reuters, Globe staff