What Happened?
Shares of computer hardware and IT solutions company Dell (NYSE: DELL) jumped 2.9% in the afternoon session after President Trump cooled fears of a transatlantic trade war by calling off scheduled tariffs on European allies.
The rally followed a productive meeting in Davos with NATO Secretary General Mark Rutte, where a "framework of a future deal" regarding Greenland and the Arctic region was established. By explicitly ruling out the use of military force and suspending the 10% tariffs previously set for February 1st, the administration provided the "sigh of relief" the market desperately needed after Tuesday's sharp sell-off. Technology and semiconductor leaders like Nvidia and AMD spearheaded the recovery as investors quickly pivoted back into growth stocks. The "Sell America" trade from the prior session reversed sharply, with the Nasdaq Composite jumping 1.5% and the S&P 500 erasing its 2026 losses. This rebound was further supported by a stabilization in the bond market; as tariff-related inflation fears subsided, the 10-year Treasury yield retreated from its recent highs, creating a more favorable backdrop for equity valuations across the board.
The shares closed the day at $113.25, up 1.5% from previous close.
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What Is The Market Telling Us
Dell’s shares are very volatile and have had 22 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 1 day ago when the stock dropped 5.3% on the news that Morgan Stanley downgraded its view on the IT hardware industry to 'cautious' and an analyst from the firm lowered the price target on Dell's stock. The investment bank warned of a 'perfect storm' for the sector, citing slowing enterprise demand, rising component costs, and rich valuations. According to a Morgan Stanley survey, corporate hardware spending budgets were expected to see minimal growth. Specifically for Dell, an analyst at the firm maintained an 'Underweight' rating but cut the price target to $111 from $113. The negative sentiment was widespread, with other hardware stocks like HP Inc and Hewlett Packard Enterprise also falling. Broader market weakness also added to the pressure, as investors reacted to new tariff threats.
Dell is down 11.4% since the beginning of the year, and at $113.25 per share, it is trading 31.3% below its 52-week high of $164.88 from October 2025. Investors who bought $1,000 worth of Dell’s shares 5 years ago would now be looking at an investment worth $1,473.
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