U.S. Market Opens Week with Cautious Gains Amid Trade Talks and Economic Data

Stocks kicked off the week with modest gains, as investors eyed developments in U.S.–China trade negotiations and digested mixed economic signals. The S&P 500 rose 0.1%, the Nasdaq added 0.3%, and the Russell 2000 outperformed with a 0.7% advance, driven by strength in small-cap names.

Optimism early in the session was tied to renewed trade discussions in London between U.S. and Chinese officials. While NEC Director Kevin Hassett downplayed expectations, suggesting only a brief meeting and a potential handshake deal on rare earths, talks stretched nearly seven hours without a breakthrough. A Fox Business report indicated discussions would continue Tuesday, and President Trump hinted at a possible update later in the evening. This uncertainty prompted some profit-taking into the close, trimming earlier gains.

Overnight headlines from China added a note of caution. Deflationary CPI and PPI prints for May pointed to continued weakness in domestic demand. Additionally, China’s trade data showed a sharp one-third drop in exports to the U.S., highlighting ongoing economic challenges.

Despite the cautious tone, five of the eleven S&P 500 sectors closed higher. Consumer discretionary led the way with a 1.1% gain, bolstered by rebounds in Tesla and Amazon. Tesla jumped 4.6%, reclaiming its 50-day moving average after last week’s sell-off, while Amazon climbed 1.6% to its highest level since February.

Technology also contributed, though it ended closer to flat with a 0.3% gain. Chipmakers stood out: the PHLX Semiconductor Index rose 2.0%, supported by a strong showing from Qualcomm (+4.1%), which hit a multi-month high after announcing a $2.4 billion acquisition of Alphawave. NVIDIA, despite early strength following CEO Jensen Huang’s keynote at London Tech Week, pared back gains to close just 0.6% higher.

Elsewhere, Apple slipped 1.2% after showcasing mostly cosmetic software updates during its WWDC keynote, dampening enthusiasm among investors expecting more.

Economic data was light, with April wholesale inventories rising 0.2%, slightly above expectations. The spotlight now turns to Wednesday’s May CPI report, which could influence the Fed’s near-term rate path.

Treasury yields declined across the curve, led by the short end. The 2-year yield fell 4 basis points to 4.00%, while the 30-year yield eased to 4.95%. A NY Fed survey showed inflation expectations easing: year-ahead expectations dropped to 3.2% from 3.6%, with three- and five-year outlooks also moderating.

Unlike the major indexes, our U.S. portfolio FTinvest 11 continued last week’s rally today, surpassing the 770 mark and briefly breaking through the 777 level at its intraday high. The evening pullback also affected our index, though to a lesser extent, and it still managed to close at 773.93, posting a daily gain of 1.38%.