Stocks rose on Tuesday, with the S&P 500 and the Dow Jones Industrial Average jumping to fresh highs, as investors shook off the threat of new tariffs from President-elect Donald Trump.

The S&P 500 and Nasdaq Composite each advanced 0.6%. The Dow Jones Industrial Average advanced 135 points, or 0.3%. Both the Dow and S&P 500 hit new intraday highs.

Trump on Monday night called for a 25% tariff on products from Mexico and Canada, as well as an additional 10% levy on Chinese goods. He has already said he would impose a tariff of up to 20% on all imports, and an additional duty of at least 60% on products from China.

But market participants appeared to look past the announcement. They either expect the taxes to not actually come to fruition, or they've already been priced in by traders, according to Jamie Cox, managing partner at Harris Financial.

"Markets have become a lot more comfortable with the prospects of these tariffs being more bluster and more negotiating tactics than actual implementation," Cox said. "Basically, what a lot of people think is that the rhetoric is a lot stronger than what the eventual tariffs will be."

While the S&P 500 rose, some individual names and funds struggled as investors analyzed potential impacts from the policies Trump discussed. Automakers Ford and General Motors slid more than 2% and 8%, respectively. Alcohol company Constellation Brands, known in part for Mexican beers Corona and Modelo, fell more than 3%.

Mexican President Claudia Sheinbaum Pardo indicated on Tuesday that any new tariffs on her country would be met with retaliatory tariffs on exports from the U.S. to Mexico. The iShares MSCI Mexico ETF (EWW), which tracks a basket of equities tied to America's southern neighbor, shed more than 2%.

These moves come after the announcement of Trump's Treasury secretary pick, hedge fund executive Scott Bessent, helped bolster the belief that the postelection rally is back in full gear on Monday. Both the Dow and S&P 500 hit new intraday records in Monday's session, with the former also finishing the day at an all-time closing high.

The small cap-focused Russell 2000 also notched a fresh high on Monday, marking its first new intraday record since 2021. But the index pulled back 0.8% in Tuesday's session, bucking the broader market uptrend.

Investors also analyzed minutes from the Federal Reserve meeting released Tuesday afternoon. The central bank said it expects interest rate cuts in the future, but to only expect them "gradually."

"In discussing the outlook for monetary policy, participants anticipated that if the data came in about as expected, with inflation continuing to move down sustainably to 2 percent and the economy remaining near maximum employment, it would likely be appropriate to move gradually toward a more neutral stance of policy over time," the minutes stated.

The U.S. market is dark on Thursday for the Thanksgiving holiday and set to close early Friday. Trading volume is expected to remain light.