Market Monitor March 5

Wall Street Rises: Trump Delays Tariffs, but Uncertainty Remains

U.S. markets closed higher on Wednesday, largely driven by the delay of import tariffs that President Trump had planned for the auto industry.

The Dow Jones and S&P 500 both gained 1.1%, while the Nasdaq closed 1.5% higher. American automakers, including General Motors (+7.2%) and Ford (+5.8%), benefited the most from the announcement.

Market Still Uncertain About Trade Policy

While the tariff delay was seen as a positive development, uncertainty surrounding U.S. trade policy remains high. Canadian Prime Minister Justin Trudeau stated that Canada is unwilling to negotiate unless all Trump tariffs are fully removed. World leaders appear to be growing increasingly frustrated with the unpredictable nature of U.S. trade strategy.

Economic Developments and Key Data

The Federal Reserve’s Beige Book reported a slight increase in U.S. economic activity since January, with price increases accelerating in some regions.

The job market saw a setback: private-sector employment grew by only 77,000 jobs in February, far below the expected 148,000. Meanwhile, mortgage applications surged by 20.4%, indicating possible strength in the housing market.

The services sector showed mixed signals. The S&P Global Purchasing Managers’ Index (PMI) pointed to slowing growth, while the ISM index indicated an acceleration. Factory orders rose by 1.7% in January, aligning with expectations.

Corporate News: Winners and Losers

Foot Locker (FL | +5.2%) surprised investors with better-than-feared results, while Abercrombie & Fitch (ANF | -9.2%) dropped due to a disappointing outlook.

CrowdStrike (CRWD | -6.3%) fell after issuing weak guidance, while Palantir Technologies (PLTR | +6.8%) gained following an analyst upgrade.

Tesla (TSLA | +2.6%) recovered slightly after steep losses earlier in the week, and Nvidia (NVDA | +1.1%) edged higher after a 13% decline since its latest earnings report.

Oil prices fell 2.9% to $66.31 per barrel on Wednesday, following an increase in U.S. crude oil inventories.

Looking Ahead

On Thursday, investors will focus on key economic reports, including weekly jobless claims, the trade balance, and fourth-quarter labor costs. Markets will also keep an eye on further trade policy developments and the economic impact of the U.S.'s shifting tariff strategy.