Wall St edges up on China trade de-escalation hopes

West Australian

07-05-2025

The three main US stock indexes are inching higher as hopes for a de-escalation in trade tensions with Beijing firmed and investors awaited the Federal Reserve's interest-rate decision later in the day.
Washington announced late on Tuesday that representatives of the two countries would meet over the weekend in Switzerland for ice-breaker trade discussions.
The meetings will follow weeks of tit-for-tat tariffs that roiled financial markets and flagged concerns about global economic growth.
Mixed signals from the world's two biggest economies recently on the status of the negotiations have led to uncertainty, pushing many companies to shelve their forecasts. The US central bank, meanwhile, adopted a wait-and-watch approach despite signs of slowing growth.
President Donald Trump's administration has said potential deals with major trading partners are underway, but markets are yet to see tangible results on that front.
"There's a lot of theatre that's going to go on, but I would think that (moving forward) sooner rather than later is probably what both parties want," said Kim Forrest, chief investment officer at Bokeh Capital Partners in Pittsburgh.
"It's become clear that a lot of the tariff talks are more for discussions on how to change trade."
In early trading on Wednesday, the Dow Jones Industrial Average rose 221.20 points, or 0.54 per cent, to 41,050.20, the S&P 500 gained 18.42 points, or 0.33 per cent, to 5,625.33, and the Nasdaq Composite gained 43.41 points, or 0.25 per cent, to 17,733.07.
Seven of the 11 S&P 500 sectors ticked up, with communication services among top advancers, helped by Walt Disney's 10.4 per cent rise after the streaming firm's quarterly results topped Street expectations.
The US Federal Reserve is scheduled to announce its policy decision on Wednesday afternoon, when it is widely expected to hold interest rates steady.
Traders are now roughly pricing in a rate cut by July, according to data compiled by LSEG, after a mixed bag of reports last week signaled a slowing US economy and resilient labour market.
Commentary from policymakers will be scrutinised for clues on how they plan to approach monetary policy easing this year, given the backdrop of Trump's criticism of Fed Chair Jerome Powell as well as repeated calls for lower interest rates, which spooked investors in April.
Wall Street ended lower for the second straight session on Tuesday, but all indexes have recouped declines logged since Trump's announcement of "Liberation Day" reciprocal tariffs on April 2.
Advanced Micro Devices was up 2.2 per cent after the chipmaker forecast revenue for the second quarter above Street estimates.
Uber dropped six per cent as the ride-hailing company missed quarterly revenue expectations.
CrowdStrike dropped 3.9 per cent. The cybersecurity company reiterated its fiscal 2025 and 2026 forecasts and announced a plan to cut jobs.
Contract research firm Charles River Laboratories shot up 20 per cent after it said it had reached an agreement with activist investor Elliott Investment Management and raised its 2025 earnings forecast.
Arista Networks fell 6.9 per cent after its quarterly report.
Advancing issues outnumbered decliners by a 2.37-to-1 ratio on the NYSE, and by a 1.6-to-1 ratio on the Nasdaq.
The S&P 500 posted seven new 52-week highs and three new lows, while the Nasdaq Composite recorded 24 new highs and 37 new lows.