Wall Street Takes Trade Uncertainties in Stride - Tech Stocks Boom
Procedure's initiation remains undecided by the Commission.
In the midst of looming trade disputes between China and the US, Wall Street is unfazed. Investors on Wall Street continue to pour money into tech stocks, despite the uncertainty.
Despite the ongoing trade uncertainties, tech stocks soared on Wall Street on Tuesday, with the Nasdaq Composite back in the black for the year. The new tariff announcements from US President Donald Trump failed to raise further alarms. However, the question remains whether the US and China will eventually strike a final trade agreement. Both sides have traded accusations of undermining already agreed-on deals in recent days. Meanwhile, the Trump administration has asked its trading partners to submit their best offers for trade talks within five weeks.
"The jury's still out on how this will all play out, but at least on the China front, it seems like a call at the highest level might be needed to break the impasse. Some in the Trump administration have suggested such a call could come this week," said market strategist Michael Brown of Pepperstone, referencing a possible call between Presidents Trump and Xi Jinping.
In a press conference on Tuesday, White House spokeswoman Karoline Leavitt confirmed that US President Trump and Chinese President Xi Jinping will have a phone call "very soon." However, she did not specify the date.
The Dow Jones Index gained 0.5 percent to 42,520 points. The S&P 500 closed 0.6 percent higher, and the Nasdaq Composite rose 0.8 percent. Preliminary figures show 1,916 advancers and 853 decliners on the NYSE.
Economic Outlook
New forecasts from the Organisation for Economic Co-operation and Development (OECD) paint a grim picture of the economic impact of the trade dispute. The OECD has once again reduced its growth estimates for the current and coming years, citing increased trade barriers and persistent uncertainty. The US and China, in particular, are affected negatively. China's weak economic data is reflective of this.
Industrial orders in the US declined more than expected in April. While the number of job openings in the US increased slightly in April, recent economic data suggests a dismal outlook.
On the bond market, yields remained unchanged, recovering from initial moderate losses. The yield on ten-year US Treasury notes was little changed at 4.46 percent. UBS expects growth risks to push up yields, leading to a possible drop in US yields below the 4 percent mark for ten-year maturities in the coming months.
Politics
Politics: "A Disgusting Abomination" Musk Slams Trump's "Big Beautiful Bill" After hitting a six-week low, the dollar rebounded sharply, with the dollar index rising 0.6 percent. The Greenback was also supported by euro weakness. The euro came under pressure after inflation data for the eurozone came in lower than expected. While a rate cut by the ECB is already expected on Thursday, the new price data could increase expectations for further rate cuts afterward, traders said.
Cheaper Gold, More Expensive Oil
The strength of the dollar weighed on the gold price. The troy ounce fell by 0.8 percent to $3,353 after a strong rally the previous day. However, gold remained near recent multi-week highs, analysts said. Ongoing demand for gold as a safe haven was driven by the lingering trade dispute.
Despite gloomy scenarios, oil prices continued to rise. Notations for Brent and WTI increased by up to 0.9 percent. Low hopes for a ceasefire in Ukraine made additional Russian supply less likely, analysts said. Additionally, the US Congress is preparing new Russia sanctions that could target the oil sector.
Tech Stocks Boom
Tech stocks were in high demand. Shares of Nvidia, a heavyweight in AI, soared by 2.8 percent, while Super Micro Computer gained 4.8 percent. Micron Technology improved by 4.2 percent after the chipmaker announced it had sent out the first sample of a new chip designed for AI applications in smartphones.
Walt Disney gained 0.6 percent. The entertainment conglomerate is laying off hundreds of employees worldwide in various departments to operate more efficiently. Dollar General rose by 15.9 percent after the retailer raised its outlook. MoonLake Immunotherapeutics climbed 18 percent. The Financial Times had reported on takeover talks with Merck & Co (+1.2%).
The ongoing US-China trade disputes have significant implications for tech stocks. These disputes create volatility, but temporary relief measures and a potential long-term agreement offer opportunities for growth. A final trade deal could significantly stabilize the market environment, benefiting tech stocks by reducing uncertainty and enhancing investor confidence.
The Commission, acknowledging the ongoing trade uncertainties between China and the US, emphasized that tech stocks continue to flourish on Wall Street, with prominent tech companies such as Nvidia, Super Micro Computer, and Micron Technology experiencing notable growth. Despite the volatile market conditions, the Commission believes that a potential long-term trade agreement could provide a significant boost to tech stocks by reducing uncertainty and bolstering investor confidence.
