Stocks rose higher Wednesday as the broader market held strong despite more cautious outlooks from the Federal Reserve and threats of more tariffs from President Donald Trump. The Dow Jones Industrial Average climbed over 70 points, while the S&P 500 Index advanced to a fresh all-time closing high and the Nasdaq Composite closed above the flatline.
Here's how the market settled on Wednesday:
S&P 500 Index (NYSE: SPY): +0.24% or +14.57 points to 6,144.15
Dow Jones Industrial Average (NYSE: DIA): +0.16% or +71.25 points to 44,627.59
Nasdaq Composite Index (NASDAQ: QQQ): +0.07% or +14.99 points to 20,056.25
Trump signaled late Tuesday that the U.S. may broaden the scope of tariffs on imports to include automobiles, pharmaceuticals and semiconductors. The president told reports that the duties would be around 25% and "go very substantially higher over a course of a year." The threat represents an expansion of the administration's already aggressive trade policy that is set to take effect in March.
"I've been contacted by some of the biggest companies in the world, and because of what we're doing economically and through tariffs and incentives, they want to come back into the United States," Trump told reporters. "When they come back into the United States and they have their plant or factory here, there is no tariff. So we want to give them a little bit of a chance."
Federal Reserve officials also agreed that they need to see more signs that inflationary pressures are lowering across the economy before they can lower interest rates further, minutes from the Federal Open Market Committee's January meeting released Wednesday showed. Committee members noted that current policy is "significantly less restrictive," than it had been before its recent string of rate cuts, which gives the Fed more time to analyze economic conditions before changing its current policy.
Committee members also cited, "the effects of potential changes in trade and immigration policy as well as strong consumer demand. Business contacts in a number of Districts had indicated that firms would attempt to pass on to consumers higher input costs arising from potential tariffs," in as the reason behind their decision to hold rates steady in January.
In the News:
Microsoft (NASDAQ: MSFT) unveiled its first quantum computing chip, Majorana 1, on Wednesday, offering its first product after nearly two decades of research in the field. Microsoft claims that building the chip required the company to create an entirely new state of matter, called a topological state.
"The difficulty of developing the right materials to create the exotic particles and their associated topological state of matter is why most quantum efforts have focused on other kinds of qubits," the company said in a blog Wednesday, referring to the eight topological qubits Majorana 1 employs.
Apple (NASDAQ: AAPL) announced a cheaper iPhone model, the iPhone 16e, on Wednesday, retailing for $599 while still being powerful enough to run the tech giant's artificial intelligence technology. The new model also uses Apple's FaceID scanner, A18 microchip, and includes Apple's first cellular modem called C1.