The excitement over artificial intelligence and U.S. President Donald Trump’s perceived friendliness to the stock market buoyed investor sentiment as recently as December. In 2025, it seems those animal spirits have somewhat evaporated.

Any time Trump brings up tariffs, investors have been reacting badly (for good reason). His threat of reciprocal tariffs on Friday — that is, imposing on other countries the same degree of duties that they place on the U.S. — sent stocks tumbling. New tariffs on steel and aluminum, which Trump says he will announce on Monday, are likely to sink stocks further.

Likewise, AI, the engine that drove stocks higher in 2024, seems to present investors with more uncertainty than opportunities this year. DeepSeek’s claim that its training required just a fraction of the billions of dollars that U.S. AI models suck up have thrown Big Tech’s investments — which will amount to more than $300 billion in 2025 — as well as their stock valuation into question.

While the main characters of the stock market remain the same as they were in December, they are steering markets in a different direction.

What you need to know today

New steel and aluminum tariffs
Trump will announce on Monday additional 25% tariffs on all aluminum and steel imports into the U.S., according to comments to reporters on Sunday. Those will come on top of already existing levies. In a separate steel-related development, Trump said on Friday at a news conference with Japanese Prime Minister Shigeru Ishiba that Nippon Steel will invest in U.S. Steel, giving up its attempt to buy it. 

EV price cuts in China amid mixed price signals
Consumer prices in China spiked 0.5% in January on an annual basis, according to the country’s National Bureau of Statistics on Sunday. The figure is higher than the previous month’s 0.1% increase and the 0.4% expected in a Reuters poll. However, producer prices dropped 2.3% in January year on year — the same degree as December and steeper than the 2.1% estimate — for their 28th straight month of declines. Meanwhile, electric car companies in China are offering discounts and interest-free loans to boost sales amid a hotly contested industry and sluggish consumer sentiment in the country.

Uneven report for U.S. labor market
The U.S. economy added 143,000 jobs in January, the Bureau of Labor Statistics reported Friday. Nonfarm payrolls for the month dropped from an upwardly revised 307,000 in December was and below the Dow Jones 169,000 estimate. However, the unemployment rate edged down to 4% from 4.1% the prior month. Average hourly earnings in January were stronger than expected, coming in at 0.5% for the month compared with the 0.3% forecast.

Asian markets rise as U.S. slumps
All major U.S. indexes ended last week lower after a losing day on Friday, when the S&P 500 lost 0.95%, the Dow Jones Industrial Average slid 0.99% and the Nasdaq Composite fell 1.36%. Stocks retreated after Trump mentioned the possibility of reciprocal tariffs on trade partners. By contrast, Asia-Pacific markets started the week higher. Hong Kong’s Hang Seng Index added around 1.8%. Singapore’s Straits Times Index hit an all-time high, lifted by shares of Singapore’s largest bank DBS Group Holdings, which jumped 2.6% and touched a new record.

Spending billions on artificial intelligence
SoftBank is close to finalizing a $40 billion primary investment in OpenAI at a $260 billion pre-money valuation, sources told CNBC’s David Faber. The cost efficiency of DeepSeek doesn’t seem to deter Big Tech: Meta, Amazon, Alphabet and Microsoft have announced plans to spend a combined $320 billion on AI and data centers. Demis Hassabis, the CEO of Google DeepMind, said on Friday that while DeepSeek is “the best work” he’s seen from China, “there’s no actual new scientific advance.”

[PRO] Inflation in focus this week
The consumer and producer price indexes for January, out Wednesday and Thursday respectively, will be especially important to investors. January’s jobs report showed a higher-than-anticipated wage growth and the University of Michigan consumer survey revealed that respondents increased their expectations of the inflation rate a year to 4.3%, a one percentage point jump from January.

And finally…

The world isn’t close to breaking free from coal — in some countries, demand for it is surging

“Nothing can destroy coal,” U.S. President Donald Trump said at the recent World Economic Forum. Statistics seem to prove him right. U.S. exports of coal have been rising steadily to satisfy growing global demand — which is expected to have breached another high of 8.77 billion tonnes in 2024 and will remain at similar levels until 2027, the International Energy Agency predicted. “The global shift away from coal remains challenging, largely driven by rising demand in Asia, even as Europe and the U.S. see significant declines in coal consumption,” said Dorothy Mei, project manager for Global Energy Monitor’s Global Coal Mine Tracker.