Investing.com-- The S&P 500 closed higher Monday, as an Nvidia-led rally in tech offset tariff comments from President Donald Trump ahead of the release of key economic data and events later this week including testimony from Federal Reserve Chairman Jerome Powell.
At 4:00 p.m. ET (21:00 GMT), the Dow Jones Industrial Average rose 166 points, or 0.4%, the S&P 500 index gained 0.7%, and the NASDAQ Composite climbed 1%.
Tech rebounds as Nvidia leads charge
NVIDIA Corporation (NASDAQ:NVDA) rose 3%, leading the overall tech market higher after Evercore ISI said the stock was a buying opportunity after the recent pullback.
Nvidia fell recently on competition fears following the emergence of AI rival DeepSeek, but Evercore, citing conversations with senior AI engineers at major cloud computing companies, said DeepSeek’s innovations represent incremental cost savings, but not an industry-changing technological breakthrough.
The bullish note on Nvidia comes ahead of the chipmaker’s quarterly results due Feb. 26.
Powell heads to Capitol Hill
Fed chair Powell is expected to face commentary and questions focused on the effects of potential tariffs on the U.S. economy when he delivers his semiannual monetary policy testimony to the House and Senate on Tuesday and Wednesday.
"Though normally investors would focus on the first day of Powell’s testimony, Wednesday’s appearance may take on added significance given the release of the the January CPI data earlier in the morning," Deutsche Bank (ETR:DBKGn) said in a recent note.
Trump announces 25% tariffs on steel, aluminum
Trump on Sunday said he will announce 25% tariffs on all steel and aluminum imports to the US on Monday, just days after his 10% tariffs on China took effect.
The tariffs will be in addition to already existing duties on the metal imports, which Trump had imposed during his first term and were retained by the Biden administration, albeit at a less severe scale.
The move stands to impact imports from Canada, Brazil, and Mexico the most, given that the three are the biggest steel exporters to the US.
Still, investors were hoping that Trump would offer some relief to Mexico and Canada, given that he had last week postponed plans to impose 25% tariffs on the two, given their major role in the US supply chain.
Trump had offered tariff exemption quotas to several US allies during his previous term.
Key CPI release due this week
On the economic data slate, the focus this week is squarely on key US consumer inflation data for January, due on Wednesday.
The gauge is projected to show that headline consumer price growth cooled on a month-on-month basis in January and equaled December’s annualized pace.
Sticky inflation provides the Fed with little impetus to cut interest rates - a trend highlighted by the central bank in January, when it kept interest rates unchanged.
Analysts and Federal Reserve officials have warned that Trump’s tariffs - which will be borne by US importers - could also underpin inflation in the coming months.
Federal Reserve Chair Jerome Powell heads to Capitol Hill this week, testifying before the Senate Banking Committee on Tuesday, and to the House Financial Services panel the following day.
This will be the first time he has answered lawmakers’ questions since July.
McDonald’s helped by international sales
In corporate news, McDonald’s (NYSE:MCD) stock over 4% after the burger giant’s comparable sales topped estimates in the fourth quarter, with its international licensed markets business was boosted by strength in the Middle East and Japan.
Elsewhere, the share prices of United States Steel Corporation (NYSE:X), Nucor (NYSE:NUE) and Cleveland-Cliffs NYSE:CLF) all soared in the wake of the report of tariffs on steel and aluminum imports.
BP (NYSE:BP) ADRs climbed over 6% after Reuters initially reported over the weekend that activist investor Elliott Investment Management has acquired a stake in the energy giant.
Elliott is pushing for changes at the British oil major to boost shareholder value, Bloomberg said in a separate report on Saturday, describing the investment as “significant.”
The activist investor believes BP is undervalued, with a market capitalization of approximately £69 billion ($85.62 billion), compared to Shell’s £161 billion valuation.
Lyft (NASDAQ:LYFT) shares jumped over 6% after a report from TechCrunch said the ride-hailing company plans to introduce fully autonomous robotaxis powered by Mobileye in Dallas as soon as 2026, with expansion to additional markets to follow.
Mobileye Global (NASDAQ:MBLY) shares also rallied following the report, climbing around 12%.
Gold hits all time highs
Gold prices hit record highs on Monday, buoyed by increased safe haven demand after US President Donald Trump announced more trade tariffs, this time aimed at commodity imports.
Spot gold jumped to a record $2,911.44 before pairing some gains.
(Peter Nurse, Ambar Warrick contributed to this report)