NEW YORK (AP) — U.S. stocks drifted higher and pulled closer to their record as the wait continues for more updates on President Donald Trump’s tariffs and how much they’re affecting the economy. The S&P 500 rose 0.6% Tuesday, coming off a modest gain that added to its stellar May. It is less than 3% away from its all-time high set earlier this year. The Dow Jones Industrial Average added 0.5%, and the Nasdaq composite rose 0.8%. Treasury yields held relatively steady following an encouraging report on the U.S. job market, while stock indexes rose modestly across much of Europe and Asia.
THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.
NEW YORK (AP) — U.S. stocks are drifting higher on Tuesday and pulling closer to their record as the wait continues for more updates on President Donald Trump’s tariffs and how much they’re affecting the economy.
The S&P 500 was 0.6% higher in late trading, coming off a modest gain that added to its stellar May. It’s back within 2.8% of its all-time high set earlier this year after falling roughly 20% below two months ago.
The Dow Jones Industrial Average was up 236 points, or 0.6%, with an hour remaining in trading, and the Nasdaq composite was 0.9% higher.
Dollar General jumped 15.4% for one of the market’s bigger gains after reporting stronger profit and revenue for the start of the year than analysts expected. The discount retailer also raised its forecasts for profit and revenue over the full year, though it cautioned that “uncertainty exists for the remainder of the year” because of tariffs and how they might affect its customers.
Many other companies have cut or withdrawn their financial forecasts for the upcoming year because of the uncertainty caused by Trump’s on-again-off-again rollout of tariffs. The Organization for Economic Cooperation and Development said on Tuesday that it’s forecasting 1.6% growth for the U.S. economy this year, down from 2.8% last year.
But while Trump’s tariffs have certainly made U.S. households feel more pessimistic about where the economy and inflation are heading, reports have suggested only a moderate hit so far. Manufacturers have begun to feel the effects, but the overall job market has remained solid overall with layoffs remaining relatively low, and inflation has not taken off.
A report on Tuesday morning showed U.S. employers were advertising more job openings at the end of April than economists expected, another signal that the labor market remains solid. It sets the stage for a more important report coming on Friday, which will show how much hiring and firing U.S. employers did in May.
On the trade front, hopes are still high on Wall Street that Trump will reach trade deals with other countries that will ultimately lower tariffs, particularly with the world’s second-largest economy. The U.S. side said President Donald Trump was expecting to speak with Chinese leader Xi Jinping this week. A Chinese foreign ministry spokesperson said Tuesday that they had no information on that.
All the hope has brought the U.S. stock market almost all the way back to its record heights nearly as quickly as it plunged in April.
“This calm won’t last indefinitely, but it will take unexpected policy news or growth and inflation data to inflect the narrative and push the markets outside these ranges,” according to Jason Draho, head of asset allocation, Americas at UBS Global Wealth Management.
In the bond market, Treasury yields held relatively steady. The yield on the 10-year Treasury edged down to 4.45% from 4.46% late Monday, though it had been lower earlier in the morning before the stronger-than-expected report on U.S. jobs openings.
It’s a cooldown following a sharp rise for yields over the last two months. Yields had been climbing in part on worries about how the U.S. government may be set to add trillions of dollars to its debt through tax cuts.
Besides making it more expensive for U.S. households and businesses to borrow money, higher Treasury yields can also discourage investors from paying high prices for stocks and other investments.
In stock markets abroad, indexes rose modestly across much of Europe and Asia.
Hong Kong was an outlier, where the Hang Seng jumped 1.5%. That came despite a report showing Chinese manufacturing activity slowed in May.
South Korean markets were closed for a snap presidential election that resulted in a victory for opposition leader Lee Jae-myung. The election was triggered by the ouster of Yoon Suk Yeol, a conservative who now faces an explosive trial on rebellion charges over his short-lived imposition of martial law in December.
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AP Business Writers Matt Ott and Elaine Kurtenbach contributed.
