By Stephen Culp
NEW YORK (Reuters) -U.S. stocks regained some strength, while gold reached new highs on Tuesday as global trade jitters kept investors guessing.
All three major U.S. stock indexes strengthened after last-minute negotiations resulted in a one-month reprieve on President Trump’s 25% levies against Canada and Mexico.
But safe-haven investors continued to favor gold after a 10% tariff against China went into effect, prompting Beijing to announce its own retaliatory tariffs against U.S. energy exports and expand its control over the export of critical minerals.
China also warned Alphabet and other American firms of potential sanctions.
“U.S. equities are in roller coaster mode as the wall of worry remains under construction,” said Terry Sandven, Chief Equity Strategist at U.S. Bank Wealth Management in Minneapolis.
“Tariffs are looming which could impact inflation and profitability,” Sandven added. “We expect volatility to be more the norm rather than the exception throughout 2025.”
Data showed U.S. job openings and factory orders both fell more than expected in December, pointing to some economic dampening, but not enough to convince the U.S. Federal Reserve to continue down its rate cutting path any time soon.
The Dow Jones Industrial Average rose 59.74 points, or 0.13%, to 44,481.65, the S&P 500 rose 40.42 points, or 0.67%, to 6,034.94 and the Nasdaq Composite rose 247.84 points, or 1.28%, to 19,639.79.
Financials weighed on European shares in the wake of UBS’ quarterly earnings report, but easing worries over a potential global trade war helped the STOXX Europe 600 flip into positive territory.
MSCI’s gauge of stocks across the globe rose 7.68 points, or 0.89%, to 867.01.
The STOXX 600 index rose 0.27%, while Europe’s broad FTSEurofirst 300 index rose 5.11 points, or 0.24%
Emerging market stocks rose 21.49 points, or 2.00%, to 1,095.21. MSCI’s broadest index of Asia-Pacific shares outside Japan closed higher by 1.97%, to 575.53, while Japan’s Nikkei rose 278.28 points, or 0.72%, to 38,798.37.
U.S. two-year Treasury yields, which are tied to the Federal Reserve’s policy moves, dipped after the JOLTS data.
The yield on benchmark U.S. 10-year notes fell 0.4 basis points to 4.539%, from 4.543% late on Monday.
The 30-year bond yield rose 1 basis points to 4.7806% from 4.771% late on Monday.
The 2-year note yield fell 3.7 basis points to 4.228%, from 4.265% late on Monday.
The dollar lost ground against a basket of world currencies after duties against Chinese goods took effect.
The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, fell 0.53% to 108.00, with the euro up 0.36% at $1.0381.
The Mexican peso < MXN=> weakened 0.49% versus the dollar at 20.45.
The Canadian dollar strengthened 0.75% versus the greenback to C$1.43 per dollar.
Against the Japanese yen, the dollar weakened 0.09% to 154.61.
In cryptocurrencies, bitcoin fell 2.49% to $99,332.53. Ethereum declined 1.23% to $2,780.54.
Crude prices tumbled before paring their losses as U.S. as Beijing fired back against newly implemented duties with its own retaliatory measures.
U.S. crude fell 0.48% to $72.81 a barrel and Brent rose to $76.21 per barrel, up 0.34% on the day.
Gold prices continued to rally, hitting fresh highs as investors flocked to the safe-haven metal.
Spot gold rose 0.99% to $2,841.27 an ounce. U.S. gold futures rose 0.35% to $2,843.70 an ounce.
(Reporting by Stephen Culp; Additional Reporting by Harry Robertson in London; Editing by Alexander Smith)
