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Wall Street stocks rise on Nvidia and trade hopes

Investors awaited more clarity about Washington's tariff plans as they awaited potential negotiations between the United States with its trading partners. The White House announced on Monday that President Donald Trump will be speaking with Chinese leader Xi Jinping this week. This comes after Trump had accused China of breaking a Geneva accord to reduce tariffs and trade barriers. Beijing has said that it will protect its interests, and that this accusation is unfounded. According to a draft of a letter sent to the negotiating partners, the Trump administration is asking countries to submit their best offers on trade negotiations before Wednesday. Officials are trying to speed up talks with multiple partners in order to meet a deadline they set themselves.

"The most important thing for investors is that the administration wasn't going to impose those much-larger-than-expected tariffs and just leave them on, which would have almost certainly led to a recession," said Chris Zaccarelli, Chief Investment Officer at Northlight Asset Management.

The fact that the U.S. has so many trading partners, including China, Japan, UK, EU, etc., makes investors more optimistic about the possibility of avoiding a recession. Investors are feeling more confident that we won't be in a recession."

In May, Trump's trade policies were softer, which allowed risky assets to recover. The benchmark S&P500 and the tech-heavy Nasdaq posted their largest monthly percentage gains since November 2023.

The preliminary data shows that the S&P 500 rose 34.59 points or 0.58% to 5,970.53 while the Nasdaq Composite increased 157.54 or 0.82% to 19,400.15. The Dow Jones Industrial Average gained 219.19 points or 0.52% to 42,524.67. Nvidia's gains boosted the information technology sector. Broadcom, a chipmaker, hit a new record high following the announcement that it had begun shipping its latest networking chips designed to speed up AI.

"Commentary about Trump and Xi speaking started yesterday, and chips will likely be a topic of discussion,"

Angelo Zino is a senior equity researcher at CFRA Research. "Given that Nivdia has been essentially locked out of China for the past few years, any discussion will tend to favor Nivdia or chips over anything else."

The U.S. Labor Department reported that job openings increased, but layoffs increased, indicating a slower labor market due to tariffs impacting the economy outlook.

Orders for Factory Products

The April drop was sharp, as the initial boost from purchasing ahead of tariffs faded. Census Bureau data from the Commerce Department showed a drop of 3.7% after a jump unrevised by 3.4% in March.

The release of the monthly jobs data will provide more information on how trade uncertainty affects the largest economy in the world.

The day will be filled with speeches by central bank officials including Lisa Cook, President of the Fed Board, Chicago Fed Austan Goolsbee, and Dallas President Lorie Logan. Kenvue shares fell, leading the declines in the benchmark S&P Index. The company, which produces consumer health products said at a Deutsche Bank Conference that retailers in China and the U.S. are destocking their products because of uncertainty about tariffs.

Dollar General's shares surged after the discount retailer exceeded its quarterly sales expectations. JPMorgan upgraded the image-sharing platform Pinterest to overweight after it was rated neutral.

Reddit shares fell on Tuesday after the social network platform was unavailable for more than 29,000 users, according to Downdetector.com. Reporting by Kanchana Chkravarty, Sukriti Gupta and Saeed Azhar from Bengaluru; editing by Devika Syamnath & Aurora Ellis

(source: Reuters)