US stocks edged higher on Tuesday as renewed US-China trade talks entered their second day after an upbeat initial meeting. The Dow Jones Industrial Average finished the day up around 0.2%, while the S&P 500 rose about 0.5%. The tech-heavy Nasdaq Composite climbed roughly 0.6%.
Both the S&P 500 and Nasdaq are now within striking distance of their all-time closing highs — 6,144.15 for the S&P, set on February 19, 2025, and 20,173.89 for the Nasdaq, set on December 16, 2024. Stocks have been buoyed by resilient corporate earnings, more positive growth forecasts, and optimism over potential tariff deals. The mood remains cautious, however, as investors keep a close eye on the latest trade developments.
While a deal on access to China’s rare earth minerals is the US’s priority, negotiators are navigating contentious issues that have fueled a rift between the two trading partners. Any signs of progress will likely be greeted with relief by markets, given the switchbacks in President Trump’s tariff policy and in US-China relations have fed uncertainty about risks to economic growth worldwide. On Monday, stocks on Wall Street reflected White House officials’ optimism after discussions, though Trump himself cautioned that “China’s not easy.”
Meanwhile, a gauge of US small-business optimism showed its first rise since September amid the trade truce with China.
But worries about Trump’s tax-and-spending megabill stoked uncertainty about the outlook, according to the NFIB survey. Investors are now awaiting the May Consumer Price Index (CPI) report on Wednesday, which will offer fresh insight into the state of inflation amid Trump’s evolving trade policy. Analysts expect price pressures to have accelerated last month.
Casey’s stock hit an all-time high on Tuesday after the company beat on both the top and bottom lines in its fiscal fourth quarter. Adjusted earnings grew 12.4% from a year ago to $2.63, alongside net sales growth of 11% to $3.99 billion. Same-store sales grew 1.7%, driven by its prepared food business, non-alcoholic beverages, and general merchandise.
CEO Darren Rebelez said the pizza and convenience store chain is seeing growth across all income cohorts and has executed against three drivers: store growth, efficiency, and its prepared foods business, including its “crown jewel” pizza business. The company plans to open 80 stores in fiscal 2026 through M&A and new store construction. Casey’s is gaining momentum, much like other value-oriented retailers, as shoppers fixate on value.
Rebelez said that low-income shoppers are making “different” purchase decisions but are still spending. “People come in, they see the candy price, and then they go over to our bakery, where we have cookies and brownies and other sweet treats that are far more affordable,” he said.
Trade talks drive US stock gains
Shares are up nearly 24% this year. The Federal Reserve received one positive data point on the inflation front ahead of Wednesday’s Consumer Price Index release. On Monday, the data showed inflation expectations for the next year, three years, and five years all fell.
Federal Reserve chair Jerome Powell frequently references surveys like this one when noting that “well-anchored” inflation expectations are key to reaching the eventual 2% inflation target. BNP Paribas chief US economist James Egelhof highlighted volatility in the data, which appears to follow political headlines, suggesting that consumers are basing their inflation views on political developments rather than on the FOMC’s 2% inflation target. “That is a problem for the Fed in and of itself,” Egelhof said.
Boeing stock erased gains of as much as 2% on Tuesday, despite booking 303 new orders in May, the most since December 2023. The aerospace giant has seen significant order increases, lifting its shares by 25% this year. The data comes ahead of the Paris Air Show, which starts next Monday.
Disney shares jumped 2% following news from peer Warner Bros. Discovery. IBM stock added more than 2% after announcing it is building the world’s first large-scale quantum computer, called Starling, capable of operating without errors. On Monday, IBM’s market cap surpassed $250 billion for the first time ever.
Conversely, shares of J.M. Smucker sank on Tuesday after the food producer forecast full-year profit below Wall Street expectations, highlighting a challenging environment for consumer packaged goods. Stocks gained on Tuesday mid-trading as investors awaited new details on the high-level trade talks between the US and China, sending the S&P 500 just over 100 points away from its all-time closing high. The index has rallied more than 20% since hitting its April lows in the aftermath of President Trump’s tariff policy unveiling.
Gold and silver prices took a breather from their recent rally on Tuesday. Gold retreated less than 0.5% during the session to hover near $3,347 per ounce. Silver hovered near $36 per ounce, its highest level since February 2012.
Bitcoin climbed toward new highs on Tuesday amid a series of tailwinds for the crypto space. The token was trading north of $109,000 each by 8:30 a.m. ET.