The closing results of the session indicated that the benchmark indices S&P 500 and Nasdaq both increased by 0.52%, reaching their highest levels in history, marking a remarkable recovery after the market collapse in April triggered by Donald Trump’s protectionist policies.
The Dow Jones Industrial Average rose by 1%.
In the past two months, “the news has been increasingly positive… in the commercial arena,” stated Tom Cahill of Ventura Wealth Management to Agence France-Presse (AFP).
The U.S. stock market was buoyed today by the completion of a trade agreement between the United States and China, which, according to Washington, includes accelerated shipments of rare earth materials to the United States.
This agreement also stipulates, according to China, that Washington will suspend certain restrictions against it. Beijing has been the primary target of Trump in the trade war initiated since his return to the White House in January.
However, in the middle of the session, Wall Street stumbled following an announcement by the U.S. President that he was immediately suspending trade negotiations with Canada, deeming Ottawa’s tax targeting digital giants a “direct and obvious strike” against the United States.
“This development adds some uncertainty with one of the country’s largest trade partners,” emphasized Angelo Kourkafas of Edward Jones to AFP.
And “it reminds us once more that as we approach July 9,” the date when higher tariffs on imports from dozens of countries are set to take effect, “there are catalysts for some volatility,” the analyst noted.
“In the next two weeks, we will likely focus on trade,” Kourkafas anticipated.
According to Tom Cahill, “the scenario is favorable for stock prices, and… they will rise,” especially since “so far, we have not seen a significant impact on tariff-induced inflation.”
Inflation slightly rebounded last month in the United States (+2.3%), according to the PCE index released today, which also showed that U.S. consumers are being more cautious with their spending.
This rebound did not surprise analysts nor the Federal Reserve (Fed).
In the bond market, the yield on the 10-year U.S. government bond rose to 4.27%, compared to 4.25% at Thursday’s close.
In the stock market, ride-hailing giant Uber fell (-1.73% to $91.51), after the New York Times reported that the company might help fund Travis Kalanick’s acquisition of the U.S. subsidiary of the autonomous vehicle company Pony.ai (-6.31% to $13.66).
Sports equipment manufacturer Nike surged (+15.24% to $72.07) after reporting fourth-quarter fiscal year results, which, although declining, were better than analysts expected.
Other sportswear and equipment companies benefited from Nike’s boost, such as Lululemon Athletica (+1.49%, to $235.02) and Dick’s Sporting Goods (+3.55%, to $202.84).
