When Tiktok proactively shut down its services in the U.S., ahead of a ban, it strengthened its position. The Chinese-based social networking firm added a pop-up message, citing Trump to bring the service back.
Trump allowed TikTok to continue operations to give the firm time to find a buyer. This strengthened the U.S. position in its trade negotiations with China. China needs TikTok to run in the U.S. to increase the company’s value.
Trump spoke with Chinese President Xi Jinping about both tariffs and TikTok. The U.S. President unexpectedly softened his stance on tariff rates. At 10%, the tariff is sharply below that threatened against both Mexico and Canada. Trump promised to impose 25% duties on those two countries on February 1.
Trades
The U.S. dollar (UUP) weakened the most in a week at a pace not seen since 2023. Investors benefited if they took profits before the softened tariff stance.
Gold should strengthen from here. Hold the SPDR Gold Shares ETF (GLD), Barrick Gold (GOLD), and Newmont Mining (NEM) as the U.S. dollar weakens.
The S&P 500 is still a hold after trading at all-time highs last week. SPY and IVV are the preferred exchange-traded funds.
U.S. Treasuries are out of favor. Be wary of holding the 20+ Year Treasury Bond ETF (TLT).
