Steady amid the storm: US stocks’ resilient start to June despite trade fears

3 minutes read

03 June 2025

Steady amid the storm: US stocks’ resilient start to June despite trade fears

It was the kind of Monday that keeps traders on their toes. As the sun rose over Wall Street, a fresh round of trade barbs between Washington and Beijing threatened to cast a shadow over the markets. Yet, by the closing bell, the mood was surprisingly upbeat. The S&P 500 had inched higher by 0.41%, the Nasdaq was up 0.67%, and the Dow managed to eke out a gain of 35 points. It was a day that captured the resilience—and the contradictions—at the heart of today’s market.

Steel, tech, and tariffs: The day’s unlikely winners

The drama began with headlines from Washington. President Trump announced plans to double tariffs on steel and aluminium imports, raising them from 25% to 50%—a move the European Union quickly criticised as “undermining” ongoing negotiations and threatened with countermeasures. Speaking at a steel plant in West Mifflin, Pennsylvania, Trump declared, “It is my great honour to raise the tariffs on steel and aluminium from 25% to 50%, effective Wednesday, June 4th. Our steel and aluminium industries are coming back like never before. This will be yet another BIG jolt of great news for our wonderful steel and aluminium workers. Make America Great Again”.

For many, it seemed like a recipe for market jitters. But the market had other ideas. Steel stocks soared. Cleveland-Cliffs surged nearly 28% in a single session, with CEO Lourenco Goncalves doubling down on cost-cutting and automotive supply as key drivers. “We are intensifying our focus on core operations and automotive steel supply, aiming for savings exceeding $300 million,” Goncalves told investors, highlighting the industry’s optimism despite recent earnings misses.

Not everyone was celebrating. Major automakers like Ford and General Motors dropped around 5% on fears that higher input costs and retaliatory tariffs could eat into profits. The contrasting fortunes of steel and auto stocks painted a vivid picture of how policy shifts can create winners and losers in real time.

Meanwhile, tech stocks kept powering ahead. The Nasdaq outperformed the broader market, buoyed by the ongoing momentum in big tech. “Investors are still willing to pay a premium for growth and innovation,” said Jeff deGraaf, head of technical research at Renaissance Macro. “Historically, the next six weeks represent one of the strongest six-week periods, rivaling only the fourth quarter. Therefore, this is not the moment to reduce positions, especially considering the calendar”.

Safe havens and shifting sentiment

As trade tensions rose, so did demand for safe havens. Gold futures climbed 2.5% to $3,370 per ounce, and Newmont Mining, the world’s largest gold producer, gained nearly 6%. “Gold is doing what it’s supposed to do—provide shelter when uncertainty rises,” said Bart Melek, global head of commodity strategy at TD Securities, in a recent interview with Bloomberg (previously quoted in similar market conditions).

Energy stocks also caught a bid. Crude oil prices spiked nearly 4% after OPEC+ raised production by less than expected, sending shares of Devon Energy and EOG Resources up about 2% each. The energy sector’s rally added another layer of complexity to a market already full of cross-currents.

Looking ahead, investors are bracing for a busy week. Earnings reports from Dollar General, Signet Jewellers, and Nio are on the docket, along with key US economic data on job openings, durable goods, and factory orders. Technical analysts like deGraaf suggest that the next six weeks could be seasonally strong for equities, even as the headlines remain unpredictable.

As the closing bell rang, one thing was clear: Wall Street’s ability to climb in the face of uncertainty is as strong as ever. “Markets have a way of looking past the noise and focusing on fundamentals,” deGraaf noted. “But with trade disputes heating up, nobody can afford to get too comfortable”.

For now, investors are keeping a close watch on Washington and Beijing—and staying nimble as the story unfolds.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Winvesta. We advise investors to check with certified experts before making any investment decisions.