Stock Market Rebounds as Auto Industry Wins Tariffs Reprieve
Automaker and tech stocks lead market rebound as investors breathe a sigh of relief. At least for now.
The stock market rebounded Wednesday after the White House announced a one-month exemption from the newly imposed auto tariffs on imports from Mexico and Canada. The decision sparked a rally across major indices, lifting automakers, technology giants, and even cryptocurrency-related stocks.
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Markets Rebound
The Dow Jones Industrial Average (DJI) climbed 485 points, or 1.1%, to close at 43,006.19. The S&P 500 (SPX) mirrored the move, rising 1.1% to 5,842.79, while the tech-heavy NASDAQ Composite (IXIC) outpaced them both with a 1.5% gain, ending at 18,547.90.
Wasif Latif, chief investment officer at Sarmaya Partners, commented on the market rebound, stating:
We are on the tariff roller coaster. The economic data, the Fed, and all that stuff seems to have been pushed to the background for now. It’s just a reminder how these policies have an impact in the long run and the markets are reacting to it.
Automakers Lead the Charge
Ford (NYSE: F) jumped 6%, while General Motors (NYSE: GM) soared nearly 7%. Stellantis (NYSE: STLA), which owns Jeep and Chrysler, surged 9%, and Toyota (NYSE: TM) added 6.5%. The relief rally came after the White House temporarily lifted the 25% tariff on auto imports from Canada and Mexico, a move that eased concerns about escalating production costs.
Jessica Caldwell, an analyst at Edmunds.com, believes the tariffs pause shows “Some flexibility from the White House and its recognition of the importance of the health of the industry.” Caldwell added, “However, a temporary pause does little to ease the long-term uncertainty automakers are facing.”
Tech Stocks Regain Momentum
The technology sector also capitalized on the improved market sentiment. Microsoft (NASDAQ: MSFT) gained 3.19%, while Nvidia (NASDAQ: NVDA) +1.13%, Broadcom (NASDAQ: AVGO) +2.19%, Amazon (NASDAQ: AMZN) +2.24%, Alphabet (NASDAQ: GOOGL) +1.23%, Meta (NASDAQ: META) +2.57%, and Tesla (NASDAQ: TSLA) +2.6% all ended higher. However, Apple (NASDAQ: AAPL) slipped slightly, dropping 0.08%, despite the broader tech sector rally.
Chipmaker Intel (NASDAQ: INTC) struggled, falling 2.44% after President Trump called for eliminating a subsidy program benefiting semiconductor firms.
Cybersecurity giant CrowdStrike (NASDAQ: CRWD) led decliners, tumbling over 6% following a revenue forecast that fell short of analyst expectations.
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Crypto Stocks and Bitcoin Rally
Bitcoin (BTC) surged above $90,000, pushing cryptocurrency-related stocks higher. MicroStrategy (NASDAQ: MSTR), one of the largest corporate holders of Bitcoin, soared 12%. Crypto exchange Coinbase (NASDAQ: COIN) and bitcoin miner MARA Holdings (NASDAQ: MARA) climbed nearly 5% and 8%, respectively.
Joel Kruger, a market strategist at LMAX Group, gave his thoughts on Bitcoin in 2025, stating:
With Fed rate expectations shifting back to pricing more rate cuts than less in 2025 and with bitcoin capable of shining as a store of value asset, we believe there are plenty of reasons to expect bitcoin to be well supported on dips.
Economic Data Sends Mixed Signals
Investors also assessed a mixed batch of economic reports. ADP’s payroll data showed private-sector hiring slowed to its lowest pace in seven months. However, reports on services sector activity and factory orders exceeded expectations, suggesting that some regions of the economy remain resilient.
The 10-Year Treasury (US10Y) yield increased to 4.29%, rebounding from Tuesday’s dip to 4.21%. Gold Futures (GC) ticked higher by 0.3% to $2,930 an ounce, while West Texas Intermediate (WTI) crude oil slumped 2.8% to $66.40 per barrel, hovering near a two-year low.
Temporary Relief or Sign of More to Come?
Despite Wednesday’s rally, uncertainty still lingers. The exemption is only set to last one month, and further trade negotiations will determine whether tariffs return or are permanently removed.
“The economic impact and consumer impact is still ahead of us,” commented Sameer Samana, head of global equities and real assets at Wells Fargo Investment Institute. “It comes back to what no one really knows, and that is how long these tariffs stay in place.”
As investors await clarity, all eyes remain on Washington. The potential for renewed volatility looms, but for now, Wall Street has found its footing once again.
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Disclaimer: Wealthy VC does not hold a position in any of the stocks, ETFs or cryptocurrencies mentioned in this article.
