The Nasdaq jumped 190.87 points (1%) to 19,714.27, the S&P 500 climbed 40.45 points (0.7%) to 6,066.44 and the Dow rose 167.01 points (0.4%) to 44,470.41.
The latest tariff threat comes after Trump said last Friday he plans to announce reciprocal tariffs on many countries this week, with the U.S. imposing tariffs on imports equal to the rates imposed on American exports. Reports on consumer and producer inflation are likely to be in focus, while reports on retail sales and industrial production may also attract attention. Traders are also likely to keep a close eye on congressional testimony by Federal Reserve Chair Jerome Powell, looking for clues about the outlook for interest rates.
Computer hardware stocks moved sharply higher, driving the NYSE Arca Computer Hardware Index up by 4.6%. Super Micro Computer (SMCI) helped lead the sector higher, soaring by 17.6% ahead of fiscal second quarter business update. Steel stocks too were significantly strong in reaction to Trump's tariff threat, resulting in a 3.3% surge by the NYSE Arca Steel Index. Gold stocks were substantially strong amid a sharp increase by the price of the precious metal, with the NYSE Arca Gold Bugs Index surging by 2.8%. Oil producer, telecom and natural gas stocks too saw considerable strength on the day while financial and biotechnology stocks bucked the uptrend.
Asia-Pacific stocks turned in a mixed performance. Hong Kong's Hang Seng Index jumped by 1.8% and China's Shanghai Composite Index climbed by 0.6% while Australia's S&P/ASX 200 Index fell by 0.3%. The major European markets all moved to the upside on the day while the UK's FTSE 100 Index advanced by 0.8%, the German DAX Index increased by 0.6% and the French CAC 40 Index rose by 0.4%.
In the bond market, treasuries gave back ground after an early upward move, ending the day roughly flat. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, crept up by less than a basis point to 493% after hitting a low of 4.45%.