The announcement of 25% tariffs on imports from China, Mexico, and Canada, set to take effect on February 1, has injected uncertainty into the markets, reversing earlier stock gains. The tariffs are expected to increase costs for imported goods, potentially squeezing profit margins for companies reliant on these imports and leading to inflationary pressures. This development comes as the Federal Reserve's preferred inflation gauge remains above its 2% target, suggesting that the central bank may need to reassess its monetary policy stance in light of potential inflationary impacts.
The yield on 10-year Treasuries rose by 3 basis points to 4.55%, reflecting market expectations of future inflation or higher interest rates. As of 16:24 on January 31, the yield on the 10-year Treasury note stands at 4.56, up from its last close of 4.51. This increase in yields indicates heightened concerns over borrowing costs for companies and consumers, amid a backdrop of mixed signals from the technology sector and ongoing trade policy shifts.