Benchmark indices on Wall Street navigated a volatile final minutes of regular trading after President Donald Trump reiterated his intention to impose 25% tariffs on Canada and Mexico. Yet, the indices ended the session with gains.

The Dow Jones ended 170 points higher, but 120 points off the highs, while the S&P 500 and the Nasdaq also closed higher, albeit off their respective sessions’ highs.

Indices traded most of the session in the green before the Trump statement, led by gains in Tesla and Meta post their quarterly results. The gains were offset by a 6% drop in shares of Microsoft.

A $328 billion exchange-traded fund tracking the Nasdaq 100 (QQQ) fluctuated after the close as Apple sank amid weak iPhone sales in China. In regular trading, equities were buoyed by data showing a surge in consumer spending, economically sensitive corners of Wall Street such as small caps outperformed.

“This bull market is still ‘breathing,’ and we should expect more stock participation in the months ahead if the economy cooperates and rates quiet down,” said Callie Cox at Ritholtz Wealth Management. It’s not that the AI story is “doomed,” but “there are so many opportunities in unloved sectors that have been ignored for so long.”

The US economy expanded at a solid pace at the end of 2024, despite drags from a strike at Boeing Co. and much leaner inventory investment. Consumer spending, which comprises the largest share of economic activity, advanced at a 4.2% pace — the first time since late 2021 that outlays have exceeded 3% in consecutive quarters.

At Strategas, Don Rissmiller says that even if that pace is starting to slow, the Federal Reserve can likely continue its policy pause for a few more months — to gather more data.

Weekly jobless claims data released at the same time unexpectedly declined, a sign of labor market strength.

“The US consumer has been unstoppable, supported by wealth creation, a strong labor market, and lending. Still, inflation is still a bit too high for the Fed’s liking and the bar to a March rate cut is rising,” said Ellen Zentner at Morgan Stanley Wealth Management.

Monthly US household spending figures on Friday will likely point to momentum heading into 2025. Economists also expect the personal income and spending report to show a slight pickup in the personal consumption expenditures index from a month earlier.

“Friday’s PCE is likely to show that inflation is still elevated and above the Fed’s target, and it comes at a time when markets are hyper jittery about a trifecta of other issues, including big tech, AI and Federal Reserve uncertainty,” said Carol Schleif at BMO Private Wealth.

(With Inputs From Agencies.)