Stock Market Today: Stocks higher on CPI relief, but trade war concerns linger
The S&P 500 is down 3.4% over the past two sessions, its worst performance since August.
U.S. stocks moved higher in early Wednesday trading, while Treasury yields and the dollar held steady, as investors picked through a key inflation reading that could provide an early indication of the impact of President Donald Trump's trade and tariff policies.
Updated at 10:20 AM EST
Canada hits back
Stocks pared some earlier gains after Canada unveiled retaliatory tariffs on around $20 billion worth of U.S goods, including steel and aluminum products, following President Trump's imposition of levies yesterday.
Foreign Minister Mélanie Joly said the country couldn't 'idly stand by" while the U.S. "attack" the steel and aluminum industry. More than half of the aluminum imported into the United States comes from Canadian sources.
The Bank of Canada, meanwhile, lowered its benchmark lending rate by 25 basis points, to 2.75%, as part of a counter-tariff measure to prop-up the domestic economy.
"We ended 2024 on a solid economic footing. But we're now facing a new crisis," Bank of Canada Governor Tiff Macklem told reporters in Ottawa. "Depending on the extent and duration of new U.S. tariffs, the economic impact could be severe. The uncertainty alone is already causing harm."
The S&P 500 was last marked 22 points, or 0.4% higher on the session, with the Nasdaq up 184 points, or 1.06%.
#BREAKING: Canada is hitting back at the United States with additional counter-tariffs worth $29.8 billion in response to new duties on Canadian steel and aluminum as a trade war escalates.https://t.co/67xwul5Cqt— Global Calgary (@GlobalCalgary) March 12, 2025
Updated at 9:34 AM EST
Inflation relief
The S&P 500 was marked 56 points, or 1.02% higher, in the opening minutes of trading, with the Nasdaq rising 276 points, or 1.58%.
The Dow gained xxx points while the mid-cap Russell 2000 index rose 21 points, or 1.08% following the softer-than-expected February inflation report.
"One reassuring inflation report won’t be enough to undo all of the recent losses, but it could help kickstart a much-needed relief rally as the S&P 500 is on the verge of correction territory," said Bret Kenwell, U.S. investment analyst at eToro.
"As we entered 2025, investors’ main economic worry centered around reflation," he added. "But as the trade war continues to escalate and as economic policy uncertainty continues to rise, that worry has shifted from inflation to the labor market and the economy as a whole. In that respect, it will take more than a few reassuring inflation reports to ease investors’ worries."
S&P 500 Opening Bell Heatmap (Mar. 12, 2025)$SPY +1.02%
