Stock Market Update Tuesday February 4, 2025

Stock Market Update Tuesday February 4, 2025 Stocks shrugged off the latest tariff developments from China, closing broadly higher in a risk-on session. The S&P 500 climbed 0.75%, fully reversing the prior day's decline, while the Nasdaq 100, buoyed by Palantir's (PLTR) stellar 24% post-earnings surge, advanced 1.2%. Small caps outperformed, with the Russell 2000 (IWM) rallying 1.4%. In after-hours trading, Alphabet (GOOGL) tumbled 6.5% post-earnings, while AMD slid 4%, weighing on sentiment.

Away From Stocks: Treasury markets saw strong demand, with the 2-year and 30-year yields settling at 4.21% and 4.75%, down five and two basis points, respectively.

In commodities, WTI crude breached the $73 per barrel level, extending its downward momentum, while gold surged to $2,843 per ounce. Bitcoin slipped to $98,000, and volatility eased, with the VIX retreating below 17.

Market Update: Navigating the Macro Landscape

Big Picture: The stock market was nervous when former President Trump signed an executive order imposing tariffs related to the drug war. As we expected, the market initially overreacted.