The S&P 500 climbed 0.4% on Monday, June 2, as markets opened June with a mix of optimism and uncertainty centered on steel tariffs and U.S.-China trade relations. President Donald Trump’s announcement of plans to double steel import tariffs to 50% played a pivotal role in driving gains for U.S. steelmakers, while shares of major automakers declined amid concerns over rising production costs. Geopolitical tensions also boosted gold prices, lifting stocks tied to precious metals.
Highlights:
S&P 500 rises 0.4% to start June trading
Steelmakers benefit from tariff hike news, with Steel Dynamics up 10.3% and Nucor rising 10.1%
Automakers face pressure; GM and Ford shares down 3.9% each
Gold prices surge more than 2%, aiding Newmont shares, which gain 5.4%
Steelmakers Surge on Tariff Increase Announcement
Shares of leading U.S. steel companies surged significantly following President Trump’s statement that tariffs on imported steel would be doubled to 50%. The president emphasized that this move aimed to protect American steelworkers and incentivize companies to source steel domestically, bolstering the U.S. steel industry amid ongoing global trade frictions.
Highlights:
Steel tariffs planned to double from current levels to 50%
Steel Dynamics (STLD) leads S&P 500 gainers with a 10.3% rise
Nucor (NUE) shares climb 10.1%, reflecting investor optimism
Tariff hike expected to shield domestic producers but raise input costs for downstream industries
The rally in steel stocks contrasts with concerns about increased costs for industries dependent on steel, such as automotive manufacturing, which has reacted negatively to the tariff escalation.
Automakers’ Shares Decline on Tariff-Driven Cost Concerns
Shares of the “Big Three” U.S. automakers took a hit following the steel tariff news, reflecting worries about higher raw material costs translating into increased vehicle production expenses. General Motors (GM) and Ford Motor (F) both slipped 3.9%, while Stellantis (STLA), parent of Chrysler and Jeep, dropped 3.6%.
Highlights:
GM and Ford shares fall 3.9% each due to cost concerns
Stellantis declines 3.6%, weighed down by steel tariff impact
Tariffs expected to increase manufacturing expenses for automakers
Market anticipates potential margin pressures amid rising steel prices
These declines highlight the tensions between protective trade policies for domestic industries and the broader economic implications for sectors reliant on imported materials.
Gold Prices Rally Amid Geopolitical Uncertainty
Heightened geopolitical tensions and a weakening U.S. dollar fueled a strong rally in gold futures prices, which jumped more than 2% on Monday. This rise translated into gains for gold producers, with Newmont (NEM), the world’s largest gold mining company, posting a notable 5.4% increase in its share price.
Highlights:
Gold futures rise over 2% due to geopolitical risks and dollar weakness
Newmont (NEM) shares climb 5.4%, benefiting from rising metal prices
Investors seek safe-haven assets amid trade and geopolitical concerns
Gold prices supported by a weaker U.S. currency, enhancing appeal for foreign buyers
The precious metal’s rally underscores investors’ growing appetite for hedging against uncertainty in global markets and currency fluctuations.
Meta Platforms Prepares AI-Powered Advertising Launch
Shares of Meta Platforms (META), the parent company of Facebook and Instagram, rose 3.6% after reports surfaced that the company plans to launch an AI-driven advertising service by the end of next year. This new service will enable advertisers to create and target campaigns using artificial intelligence, potentially transforming digital marketing strategies.
Highlights:
Meta shares gain 3.6% on news of AI-powered ad platform launch
Service expected by end of 2025, enhancing campaign targeting
Reflects growing integration of AI in digital advertising
Meta positioned to capitalize on AI advancements to boost revenue
This development reflects Meta’s ongoing efforts to innovate and maintain its competitive edge in the digital advertising space.
Renewable Energy Stocks Falter on Grant Cancellations
Renewable energy stocks faced downward pressure following the Department of Energy’s announcement of more than $3.7 billion in grant cancellations for clean energy and climate-related initiatives. These cuts heightened investor concerns about the future of renewable energy incentives, especially amid ongoing legislative uncertainties related to the House’s reconciliation bill.
Highlights:
Department of Energy cancels $3.7 billion in clean energy grants
First Solar (FSLR) suffers a 5.3% decline, the largest drop among S&P 500 stocks
Funding cuts amplify worries about potential reductions in renewable energy support
Policy uncertainty weighs on sector sentiment and stock performance
The pullback in renewable energy shares highlights the sensitivity of this sector to government policy decisions and funding availability.
Leidos Holdings Shares Slide Despite Cyber Acquisition
Shares of defense technology company Leidos Holdings (LDOS) fell 4.6% on Monday, despite the company’s recent acquisition of Kudu Dynamics, an AI-driven offensive cyber capabilities developer. The acquisition aligns with Leidos’ strategic focus on cybersecurity growth; however, analyst downgrades citing a challenging contract environment and uncertain government spending tempered investor enthusiasm.
Highlights:
Leidos shares drop 4.6% amid mixed outlook
Acquisition of Kudu Dynamics supports AI and cybersecurity expansion
Baird downgrades stock from “outperform” to “neutral”
Concerns over government contract booking and fiscal uncertainty
