NEW YORK (AP) — U.S. stocks are drifting just below their all-time high on Tuesday as the wait continues to hear what will come of trade talks underway between the United States and China.
The S&P 500 was 0.5% higher in late trading as talks between the world’s two largest economies carried into a second day. The Dow Jones Industrial Average was up 91 points, or 0.2%, with an hour remaining in trading, and the Nasdaq composite was 0.6% higher.
Stocks have roared higher since dropping roughly 20% below their record two months ago, when President Donald Trump shocked financial markets with his announcement of stiff, wide-ranging tariffs. Much of the rally was due to hopes that Trump would lower his tariffs after reaching trade deals with countries around the world, and the S&P 500 is back within 1.8% of its all-time high, which was set in February.
It’s getting to be time to see whether such hopes were warranted. The talks with China, which are likely covering a range of disagreements between the two countries, were “going well,” U.S. Commerce Secretary Howard Lutnick said as he arrived Tuesday morning. He expected them to continue all day in London.
Both the United States and China have put many of their tariffs announced against each other on pause as talks continue.
Even though many tariffs are on hold for the moment, they’re still affecting companies and their ability to make profits because of all the uncertainty they’ve created.
Designer Brands, the company behind the DSW shoe store chain, became the latest U.S. company to yank its financial forecasts for 2025 because of “uncertainty stemming primarily from global trade policies.”
The company, which also owns the Keds, Jessica Simpson and other shoe brands, reported a larger loss for the start of the year than analysts were expecting, and its revenue also fell short of forecasts. CEO Doug Howe pointed to ”persistent instability and pressure on consumer discretionary” spending, and the company’s stock tumbled 20.4%.
The uncertainty is moving in both directions, to be sure. A survey released Tuesday of optimism among small U.S. businesses improved a bit in May.
“While the economy will continue to stumble along until the major sources of uncertainty are resolved, owners reported more positive expectations on business conditions and sales growth,” according to Bill Dunkelberg, chief economist at the National Federation of Independent Business.
On Wall Street, J.M. Smucker fell 15.1% even though its results for the latest quarter topped analysts’ expectations. Its revenue fell short of expectations, as did its forecast for profit in the upcoming year.
Tesla helped to offset such losses after rising 5.1%. The electric vehicle company has been recovering since tumbling last week as Elon Musk’s relationship with Trump imploded. That raised fear about possible retaliation by the U.S. government against Tesla.
Shares that trade in the United States of chipmaking giant Taiwan Semiconductor Manufacturing Co. rose 2.7% after the company known as TSMC said its revenue in May jumped nearly 40% from the year earlier.
Casey’s General Stores leaped 11.5% after the chain of convenience stores based in Ankeny, Iowa, reported a stronger profit for the latest quarter than analysts expected. It credited strength in sales of hot sandwiches and other items.
In stock markets abroad, indexes were mixed amid mostly modest movements across Europe and Asia. A 0.8% drop for Germany’s DAX and a 0.6% gain for South Korea’s Kospi were a couple of the bigger moves.
In the bond market, the yield on the 10-year Treasury eased to 4.47% from 4.49% late Monday.
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AP Business Writers Matt Ott and Elaine Kurtenbach contributed.
U.S. and Chinese officials say a trade deal between the world’s two largest economies is drawing closer. The sides have reached an initial consensus for President Donald Trump and Chinese leader Xi Jinping to aim to finalize during their high-stakes meeting Thursday in South Korea. Any agreement would be a relief to international markets. Trump's treasury secretary says discussions with China yielded preliminary agreements to stop the precursor chemicals for fentanyl from coming into the United States. Scott Bessent also says Beijing would make “substantial” purchases of soybean and other agricultural products while putting off export controls on rare earth elements needed for advanced technologies.
Some seniors say the Social Security Administration's cost-of-living adjustment won’t help much in their ability to pay for their daily expenses. The agency announced Friday the annual cost-of-living adjustment will go up by 2.8% in 2026, translating to an average increase of more than $56 for retirees every month. Eighty-year-old Florence, South Carolina, resident Linda Deas says it does not match the current "affordability crisis.” The benefits increase will go into effect for Social Security recipients beginning in January. Friday’s announcement was meant to be made last week but was delayed because of the federal government shutdown. Recipients got a 2.5% COLA boost in 2025 and a 3.2% increase in 2024.
Wall Street is heading for records after an update said U.S. households are feeling a bit less pain from inflation than feared. The S&P 500 climbed 1% Friday and was on track to top its all-time high set earlier this month. The Dow Jones Industrial Average jumped 529 points, and the Nasdaq composite rose 1.3%. Both are also heading toward records. The inflation data could clear the way for the Federal Reserve to keep cutting interest rates in hopes of helping the slowing job market. A strong earnings reports from Ford Motor and continued gains for AI stars also drove stocks higher.
Federal Reserve Chair Jerome Powell says that a sharp slowdown in hiring poses a growing risk to the U.S. economy.
Three researchers who probed the process of business innovation have won the Nobel memorial prize in economics for explaining how new products and inventions promote economic growth and human welfare, even as they leave older companies in the dust.
U.S. stocks are rising and recovering some of their sell-off from Friday. The S&P 500 climbed 1.6%.
President Donald Trump says “there seems to be no reason” to meet with Chinese leader Xi Jinping as part of an upcoming trip to South Korea after China restricted exports of rare earths needed for American industry. The Republican president suggested Friday he was looking at a “massive increase” of import taxes on Chinese products in response to Xi’s moves. Trump says one of the policies the U.S. is calculating is "a massive increase of Tariffs on Chinese products coming into the United States." A monthslong calm on Wall Street was shattered, with U.S. stocks falling on the news. The Chinese Embassy in Washington hasn't responded to an Associated Press request for comment.
Most members of the Federal Reserve’s interest-rate setting committee supported further reductions to its key interest rate this year, minutes from last month’s meeting showed.
From Wall Street trading floors to the Federal Reserve to economists sipping coffee in their home offices, the first Friday morning of the month typically brings a quiet hush around 8:30 a.m. eastern, as everyone awaits the Labor Department’s monthly jobs report.
U.S. stocks are adding to their records as Wall Street cruises toward the finish line of another winning week. The S&P 500 rose 0.3% Friday and is heading for its seventh winning week in the last nine.
