MARKET SNAPSHOT
U.S. stocks erased early declines with the S&P 500 ending at another new high as the market shrugged off President Trump warnings of tariffs of 25% or more on automobiles, semiconductors and pharmaceutical products. Treasury yields gave up early gains and declined after minutes from the Federal Reserve brought no big surprises. Oil futures advanced on supply concerns after this week's drone strike on a pumping station for a pipeline carrying crude from Kazakhstan to the Black Sea, and some North Dakota production being shut in by the freezing weather. Gold retreated from its record high, while the dollar edged higher.
MARKET WRAPS
EQUITIES
U.S. stocks inched higher, reversing earlier declines, as investors paused to digest Federal Reserve meeting minutes, new housing data and fresh tariff threats from President Trump.
Trump's threat, shortly after taking office, to impose levies on Mexico and Canada rattled markets. But in recent weeks traders have been inclined to view tariff talk as more of a negotiating tactic.
Still, the president's recent comments weighed on some sectors Wednesday, particularly auto stocks.
"Even as tariff policy shifts, there are certain industries that are clearly within its crosshairs," said Kara Murphy, chief investment officer at Kestra Investment Management.
The S&P 500 rose 0.2%, finishing at a new record close - its third of 2025. The Dow Jones Industrial Average increased 0.2%, and the Nasdaq Composite climbed 0.07%.
Earlier Wednesday, Chinese shares closed mostly higher, supported by semiconductor and technology stocks. Investor sentiment remained high after President Xi's meeting with business leaders, as markets await the Two Sessions meeting in early March for more policy signs.
The benchmark Shanghai Composite Index added 0.8%, the Shenzhen Composite Index gained 1.9% and the ChiNext Price Index rose 2.1%. Hong Kong's Hang Seng Index dropped 0.1% amid declines in banks.
Japan's Nikkei Stock Average fell 0.3% as concerns about borrowing costs and U.S. tariffs persisted. Auto stocks and trading houses led declines.
Stocks in Australia slipped, as the S&P/ASX 200 dropped 0.7%, the third consecutive day of decreases.
New Zealand's NZX-50 edged 0.1% lower, falling for a second consecutive session of narrow declines, as the country's central bank slashed the cash rate by another 50 basis points.
COMMODITIES
Oil futures finished with modest gains, finding support on curtailed supply from Russia as traders also monitored talks aimed at ending the war in Ukraine.
West Texas Intermediate crude for March delivery rose 0.6%, to finish at $72.25 a barrel. April Brent crude settled at $76.04 a barrel, up 0.3%, on ICE Futures Europe.
"Natural gas and oil are moving higher on a deadly Arctic Blast that could drive demand to records while supplies get frozen in," said Phil Flynn, an analyst at Price Futures Group.
Nymex March natural-gas futures jumped 6.8% to end at $4.28 per million British thermal units, the highest finish since Dec. 30, 2022.
Front-month gold futures settled down 0.4% to $2,919.40 an ounce, backing off the record high settlement from the previous session.
TODAY'S TOP HEADLINES
Fed Minutes Reveal Little Appetite for Near-Term Rate Cuts
Fed officials were broadly comfortable with their decision to hold interest rates steady at their meeting last month and offered nothing to suggest any immediate change to their wait-and-see stance on interest-rate cuts.
"A majority of participants observed that the current high degree of uncertainty made it appropriate for the committee to take a careful approach in considering additional adjustments to the stance of monetary policy," said the minutes of the Jan. 28-29 policy meeting, which were published Wednesday with a customary three-week lag.
The decision last month to leave the benchmark federal-funds rate at its current level around 4.3% followed rate cuts at three consecutive meetings-beginning in September, when the rate stood around 5.3%.
Trump Is Scrambling Global Automakers' Reliance on America
Facing intense competition in China and heavy regulation in Europe, overseas automakers were counting on the U.S. to keep their engines humming. Then came President Trump's tariff threats.
Since taking office, the U.S. president has taken aim at the $918 billion U.S. trade deficit with a raft of tariff proposals, including a 25% tax on shipments from Mexico and Canada, reciprocal tariffs based on other partners' own trade restrictions, and specific tariffs for sectors such as autos and semiconductors.
On Tuesday, Trump said the sector tariffs could be "in the neighborhood of 25%" and might rise even higher over time. A grace period could give companies time to bring production onshore, he added.
Apple Unveils iPhone 16e, With In-House Chip That Cost Billions
Apple announced the iPhone 16e on Wednesday, an update to a budget-friendly version of its flagship device. The most significant change to the phone will be invisible to users.
Inside the phone is Apple's first in-house cellular chip-a critical component for smartphones that enables cellular connections. The chip, which Apple dubbed the C1, is a long-awaited next step in Apple's efforts to make more of its own technology, and especially to wean itself from having to pay billions annually to cellular-chip-maker and rival Qualcomm.
The new iPhone 16e will be available at the end of this month, selling for $599. The 16e is priced at a level consistent with previous generations of Apple's lowest-priced iPhone, the SE, which was released in 2022 with a starting price of $429.
Nikola, Once a Darling of Green Investment, Files for Bankruptcy
Nikola, the electric vehicle maker that briefly sported a market value comparable to Ford Motor, has filed for bankruptcy with plans to wind down its business.
Now a penny stock, Nikola filed for chapter 11 on Wednesday in a Wilmington, Del., court, intending to conduct a court-supervised auction of its assets. The filing further swells the ranks of zero-emissions vehicle developers that have run out of road recently, following other Tesla wannabes that wound up in bankruptcy.
Nikola came to symbolize the excesses of a green-auto investment boom that has cooled amid rising costs and a shifting political landscape in a second Trump administration that has put planned investments in zero-emissions autos at risk.
Rio Tinto 2024 Profit Rises, But Weaker China Iron-Ore Demand Hurts Underlying Earnings
Rio Tinto reported a 15% rise in annual net profit, but pared its dividend as weaker iron-ore prices weighed on underlying earnings.
The world's second-biggest miner by market value recorded a net profit of $11.55 billion in 2024, up from $10.06 billion in 2023. Its bottom line benefited from some asset sales and lower impairment charges against its Australian alumina refineries.
Underlying earnings-a closely watched measure that strips out some one-time charges-totaled $10.87 billion, down 7.6% year over year. Analysts expected underlying earnings of $11 billion, according to data compiled by Visible Alpha.
Expected Major Events for Thursday
00:30/AUS: Jan Labour Force
00:30/AUS: Jan Foreign Exchange Transactions and Holdings of Official Reserve Assets
04:00/MAL: Jan External Trade
05:00/JPN: Jan Convenience Store Sales
08:00/TAI: Jan Export Orders
08:20/TAI: 4Q Balance of Payments
08:30/HK: Jan CPI
09:59/CHN: People's Bank of China loan prime rate (LPR) announcement
10:59/INA: 4Q Balance of Payments
21:00/SKA: Mar Business Survey Index
21:45/NZ: Jan Overseas Merchandise Trade
22:00/AUS: Feb Australia Flash PMI
23:30/JPN: Jan CPI (Nation), CPI ex-food (Nation)
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This article is a text version of a Wall Street Journal newsletter published earlier today.
(END) Dow Jones Newswires
February 19, 2025 16:49 ET (21:49 GMT)
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