US stocks drifted closer to record highs on Monday as the world's two largest economies began talks on trade that could help avoid a recession.
- The S&P 500 rose 5.52 points, or 0.1%, to 6,005.88 and is 2.3% below the record it reached in February.
- The Dow Jones Industrial Average fell 1.11 points, or less than 0.1%, to 42,761.76.
- The Nasdaq composite rose 61.28 points, or 0.3%, to 19,591.24.
Markets are waiting to hear what comes of trade talks between the United States and China taking place in London. Treasury yields slipped after a survey suggested consumers' expectations for coming inflation eased slightly in May, the
AP reports.
Some of the market's biggest moves came from the announcement of big buyout deals. Qualcomm rallied 4.1% after saying it agreed to buy Alphawave Semi in a deal valued at $2.4 billion. IonQ, meanwhile, rose 2.7% after the quantum computing and networking company said it agreed to purchase Oxford Ionics for nearly $1.08 billion. On the losing side of Wall Street was Warner Bros. Discovery, which flipped from a big early gain to a loss of 3% after saying it would split into two companies. One will get Warner Bros. Television, HBO Max and other studio brands, while the other will hold onto CNN, TNT Sports, and other entertainment, sports, and news television brands around the world.
Tesla tumbled last week as Elon Musk's relationship with Trump broke apart, but it rose 4.6% Monday after flipping between gains and losses earlier in the day. The frayed relationship could end up damaging Musk's other companies that get contracts from the US government, such as SpaceX. Rocket Lab, a space company that could pick up business at SpaceX's expense, rose 2.5%.
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Hopes that President Trump will lower his tariffs after reaching trade deals with China and other countries have been among the main reasons the S&P 500 has rallied so furiously since dropping roughly 20% from its record two months ago. It's back within 2% of its all-time high set in February, and it's higher than it was before Trump shocked financial markets in April with his wide-ranging tariff announcement on what he called "Liberation Day." This may be the shortest sell-off following a shock of heightened volatility on record, according to strategists at Deutsche Bank. Typically, stocks take around two months to bottom following a spike in volatility and then another four to five months to recover their losses. This time around, stocks have basically made a round trip in less than two months.
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