Wall Street’s main indices opened mixed on Tuesday as investors awaited potential tariff negotiations between the United States and China, seeking clarity on a trade war that has rattled global markets for months. The Dow Jones Industrial Average opened flat at 42,304.5, while the S&P 500 inched up 2.6 points or 0.04% to 5,938.56. The Nasdaq Composite rose 46 points or 0.24% to 19,288.66 at the open.
The anticipated conversation between President Donald Trump and Chinese President Xi Jinping comes at a crucial moment in U.S.-China relations, as both nations try to stabilise a fragile trade relation after months of escalating tensions.
Following a damaging tariff standoff — with the U.S. imposing sweeping tariffs up to 145% on Chinese imports in April and China responding with significant retaliatory duties — both sides have taken tentative steps toward de-escalation. The 90-day suspension of most tariffs, agreed to after mid-May negotiations in Switzerland, signaled a willingness to cool tempers and pursue a more structured trade dialogue.
Markets closed higher on Monday, buoyed by optimism surrounding ongoing trade talks, despite President Donald Trump’s latest call to double tariffs on imported steel and aluminum. The S&P 500 gained 25.50 points (0.43%) to end at 5,937.19, the Nasdaq Composite climbed 133.13 points (0.70%) to 19,246.90, and the Dow Jones edged up 39.58 points (0.09%) to close at 42,309.65. The S&P 500 also logged its biggest monthly gain since November 2023 in May, reflecting underlying investor confidence.
Energy stocks advanced after OPEC+ maintained its current output levels for July. In tech, Nvidia and Meta recorded strong gains, while Tesla dipped following weaker sales in Portugal, Denmark, and Sweden.
Steel stocks rallied following tariff news, with Cleveland-Cliffs, Nucor, and Steel Dynamics all rising. However, auto stocks like Ford and General Motors declined.
Markets are also pricing in at least two 25-basis-point rate cuts by the end of the year, according to LSEG data. Eyes are now on Friday’s nonfarm payrolls report, a key indicator of labor market strength amid continued tariff uncertainty.