NEW YORK — U.S. stock markets edged nearer to their peak on Tuesday as investors awaited developments from ongoing trade negotiations between the United States and China.
The S&P 500 went up by 0.5%, buoyed by continued talks between the two global economic powerhouses. Simultaneously, the Dow Jones Industrial Average climbed by 105 points, or 0.2%, while the Nasdaq composite increased by 0.6%.
Stocks have seen a significant rebound since they plummeted about 20% below their all-time high just two months ago, a consequence of President Donald Trump’s surprise imposition of steep tariffs. The tariffs had initially sparked fears of an impending recession. The market rally has largely been fueled by hopes that Trump might reduce tariffs following successful trade agreements with various nations, bringing the S&P 500 to just 1.7% shy of its record set in February.
The time has come to assess whether these optimistic expectations hold merit. U.S. Secretary of Commerce Howard Lutnick remarked while in London that the trade discussions with China were progressing “really, really well.” According to Lutnick, the negotiators tackled “all sorts of trade issues” during these discussions.
Both nations have taken a hiatus on many of their announced tariffs against each other as discussions continue. However, the existing uncertainty still impacts companies and their profitability expectations. Designer Brands, the company operating DSW shoe stores, became the latest among U.S. firms to retract its 2025 financial forecasts due to “uncertainty primarily stemming from global trade policies.”
Designer Brands, which also owns popular names like Keds and Jessica Simpson, faced a greater-than-expected loss early this year, with its revenue failing to meet analysts’ forecasts. CEO Doug Howe cited “persistent instability and pressure on consumer discretionary” expenditures, leading to the company’s stock plunging by 18.2%.
Uncertainty is not one-sided, however. A survey reflecting optimism among small U.S. businesses showed a slight uptick in May. According to Bill Dunkelberg, the chief economist for the National Federation of Independent Business, “While the economy will continue to stumble along until the major sources of uncertainty are resolved, owners reported more positive expectations on business conditions and sales growth.”
On Wall Street, J.M. Smucker fell 15.6%, despite its quarterly results exceeding analysts’ expectations. The company’s revenue fell below projections, as did its future profit forecast.
Amidst these setbacks, Tesla saw a 5.7% rise. The electric vehicle giant started recovering from last week’s declines following a fallout in Tesla CEO Elon Musk’s relationship with Trump, which had instigated concerns about potential reprisals from the U.S. government against Tesla.
Taiwan Semiconductor Manufacturing Co., known as TSMC, observed a 2.6% increase in its shares trading within the U.S. as it announced a nearly 40% surge in May’s revenue compared to the previous year.
Casey’s General Stores experienced an 11.6% leap after reporting stronger profits for the latest quarter than analysts had anticipated. The chain’s success was attributed to robust sales in hot sandwiches and other products.
Ultimately, the S&P 500 increased by 32.93 points to reach 6,038.81. The Dow Jones Industrial Average climbed by 105.11 to 42,866.87, and the Nasdaq composite surged by 123.75 to close at 19,714.99.
International stock markets exhibited mixed results with relatively modest fluctuations across Europe and Asia. Germany’s DAX registered a 0.8% decline, whereas South Korea’s Kospi saw a 0.6% rise.
In the bond market, the yield on the 10-year Treasury slightly decreased to 4.47% from 4.49% late Monday.