Trump Doubles Tariffs: Steel Stocks Surge, Consumer Discretionary Stocks Suffer

Published: June 2, 2025 by Omor IE

Key Points

Steel stocks are surging due to Trump doubling tariffs on steel and aluminum.
Consumer discretionary stocks are tumbling, especially those in the automotive sector.
The broader market as a whole has been rather benign despite the tariff escalation.
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President Donald Trump announced that he is doubling tariffs on imported steel and aluminum from 25% to 50%, effective June 4, 2025. This is expected to improve the environment for American steel companies and is linked to a partnership deal with Japan’s Nippon Steel.

He also said that China was violating the terms of the trade truce last month, and China has hit back by saying the U.S. was being discriminatory. As a result, the stock market has seen an uptick in fear. If Trump cancels the trade truce or announces new tariffs to compensate for the perceived violation, it could spiral into another tit-for-tat escalation. The E.U. is said to be preparing potential countermeasures already due to the steel and aluminum tariff increase.

In the meantime, steel stocks have gained. A reduction in steel imports will lead to much higher demand for domestic steel and aluminum companies. That also means they will have higher pricing power, so companies reliant on steel have seen their stocks slide.

Here’s a market update as of 11:00 AM (ET) today.

The S&P 500 is down 3.7 points, or 0.1%.
The Nasdaq Composite is up 26.5 points, or 0.13%.
The Dow Jones Industrial Average is down 125.1 points, or 0.3%.

Steel Stocks Up, Discretionary Stocks Down

Cleveland-Cliffs (NYSE: CLF) is up 23.3%.
Steel Dynamics (NASDAQ: STLD) is up 10.2%.
Nucor (NYSE: NUE) is up 10.2% as well.
Freeport-McMoRan (NYSE: FCX) is up 4.2%.
Newmont Corporation (NYSE: NEM) is up 5.4%. It isn’t a steel or an aluminum business, but gold has been soaring today. Since this is the biggest gold miner, investors are bullish here too.

As for the discretionary stocks that are down,

General Motors (NYSE: GM) is down 4.3%.
Ford Motor (NYSE: F) is down 3.8%.
Williams-Sonoma (NYSE: WSM) is down 3.2%.
Tesla (NASDAQ: TSLA) is down 3%.
DR Horton (NYSE: DHI) is down 2.6%.

Notable Gainers Today

Apart from those steel gainers, there have also been plenty of other winners.

Vera Therapeutics (NASDAQ: VERA) is up 59% after it reported that its trial of a kidney disease drug achieved its primary endpoint.
Applied Digital (NASDAQ: APLD) is up 46.2% after it signed a $7 billion deal with CoreWeave (NASDAQ: CRWV).
Kymera Therapeutics (NASDAQ: KYMR) is up 33.5% after solid phase 1 study results.
Blueprint Medicines (NASDAQ: BPMC) is up 26.2% as Sanofi (NASDAQ: SNY) will be buying it for $9.5 billion.
BioNTech SE ADR (NASDAQ: BNTX) is up 18.4% after reports of a cancer drug collaboration with Bristol Myers Squibb (NYSE: BMY).

Notable Losers Today

Gibo Holdings (NASDAQ: GIBO) is down 18.5%.
Simulations Plus (NASDAQ: SLP) is down 14.2%.
Science Applications International (NASDAQ: SAIC) is down 13% after it reported disappointing Q1 results. Free cash flow fell short of expectations.
Gyre Therapeutics (NASDAQ: GYRE) is down 10.4%.
Daktronics (NASDAQ: DAKT) is down 8.6%.