Trump's tariffs keep coming. Stock markets don't seem to care.

At least for now, the U.S. stock market is on board with President Donald Trump’s increasingly aggressive use of executive power when it comes to tariffs

At least for now, the U.S. stock market is on board with President Donald Trump’s increasingly aggressive use of executive power when it comes to tariffs.

On Tuesday, major stock indexes hit fresh all-time highs as investors digested an inflation report that was mostly tamer than feared. While the details of the report suggest an overall mixed picture for the economy, it suggested fears of large immediate price increases from Trump’s tariffs may no longer be warranted.

“Many prices will end up rising in time due to tariffs, but we don’t see inflation pressures persisting,” James Knightley, chief international economist at ING, said in a note to clients. “We are in a very different situation to 2021/22 when inflation soared to 9%.”

While the rate of inflation for some goods exposed to tariffs picked up in July, it was weaker for others, like appliances and apparel. Last month’s heavier price increases were instead mainly found in service sectors like airfare and auto insurance rates.

“The strength was concentrated to a few specific components and not broad based,” analysts with Citi said in a note.