It’s time to get on the fast track to stock profits — with the five things you need to make money this week … in just five minutes.
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Tariffs Are Back on the Table
A week after the U.S. hit the pause button on across-the-board tariffs on goods from Mexico and Canada, the Trump administration suggested that more tariffs were on the way.
On his way to the Super Bowl in New Orleans, President Donald Trump announced plans to place a 25% tariff on all steel and aluminum imports into the U.S. this week.
Trump said the levies would apply to imports from all countries. The irony is that the U.S. imports a majority of both metals from Canada and Mexico:
Markets had a muted response in early trading Monday, with the Bloomberg Dollar Spot Index ticking up 0.2%, aluminum futures rising 1% in Asia, and shares of steelmaker ArcelorMittal SA falling 1.7% in premarket trading.
While Trump announced the plan for tariffs, no timeline for those duties was released.
This latest round of tariffs would join the 10 percentage point increase in tariffs on all goods coming from China, which went into effect last week.
Time will tell if these tariffs will remain in place. Last week, President Trump quickly rescinded planned tariffs against Canada and Mexico after making a deal with two of America’s largest trading partners.
One thing is clear: President Trump is sticking to his word and will likely continue to wield tariffs as a bargaining tool.
Get Ready for Thursday
After Nvidia lost $600 billion in market cap in one day, we’re all wondering what’s next for artificial intelligence (AI) and Big Tech. (Check out the chart below for some developments there…)
Chief Investment Strategist Adam O’Dell has been tracking the potential for another tech meltdown, and he’s circled February 26 as a critical date.
He’ll have more information later this week in Money & Markets Daily…
Big Tech Going All-In On AI
If there’s one thing Big Tech does well, it’s spend money.
During their quarterly earnings reports last week, both Alphabet Inc. (GOOGL) and Amazon.com Inc. (AMZN) announced plans to spend $175 billion on AI-related capital expenditures in 2025.
Toss in Microsoft Corp.’s (MSFT) $80 billion and Meta Platform’s (META) $65 billion, and you have a huge amount of money dropping into AI this year:
All told, those four companies plan to spend more than $315 billion on AI-related capex in 2025.
That’s the equivalent of giving every American around $1,000 each.
It all means that, no matter what you might think of the news from China’s DeepSeek — which claimed to spend just $6 million to develop a large-language model — the AI mega trend still has plenty of momentum behind it and American companies are going all-in to continue development.
The Penny’s Days May Be Numbered
Late Sunday night, President Trump made another announcement: He’s ordering the U.S. Treasury to stop making the penny.
If and when the penny is phased out, the U.S. will join other countries like Brazil, Chile, China and Canada as countries that have stopped production of their low-denomination coins, according to The Washington Post.
The glaring reason why Trump would halt the production of the penny is because it costs more to produce it than it is actually worth.
It costs $0.0307 to produce one penny – triple the actual value.
The penny is not alone. It costs $0.115 to make one nickel – more than double the value.
Other coins are safe, however, as they cost $0.053 to produce a dime, $0.116 to produce a quarter and $0.259 to make a half-dollar.
If the penny is removed from circulation, consumers could see final post-tax totals rounded up or down to the nearest five-cent increment — similar to what Canada did when it stopped using the penny in 2012.
“Cautious Optimism” for 2025
It’s hard to find a better word than “volatile” to describe stock market action in 2025. We’ve had wildfires, an AI-driven snap crash, and a whirlwind start to President Trump’s second term.
Last week, we asked how bullish you were feeling for 2025 after an incredible run that saw all three major U.S. indexes gain 23% or more last year. Thank you to the 100+ people who voted in our poll! Keep an eye out for more community questions in future editions of “The 5” on Mondays.
Of the responses we received, most fell into two camps: bullish and hunting for more, or on the fence in “wait and see” mode:
- I’m all in and looking for more bullish opportunities: 34.5%.
- I’m still bullish, but I’m not looking at new stocks: 15.5%.
- I’m on the fence and waiting to see how this year shakes out: 27.6%.
- I’m taking some profits and diversifying into more defensive positions: 13.8%.
- I’m worried about a crash and am actively hedging my portfolio: 8.6%.
We can’t make any grand assumptions, but there’s a clear trend here. While volatility has kicked up, our poll results show that people are at least, as Adam likes to say, “cautiously optimistic.”
And that makes sense, considering major indexes have had a strong start to 2025 — all things considered. The Dow Jones Industrial Average is leading the way with a 4.5% gain year to date, while the S&P 500, Nasdaq 100 and Russell 2000 are all up more than 2%.
Whatever happens next, we’ll have you covered here in Money & Markets Daily.
Safe trading,
Matt Clark, CMSA®
Chief Research Analyst, Money & Markets