U.S. Stock Markets Show Cautious Growth Amid Trade Negotiation Progress
Market news 10 JUN
At the beginning of the week, U.S. stock indexes showed moderate gains, with the S&P 500 reaching a 3.5-month high amid signs of progress in trade negotiations between the U.S. and China. Investor optimism was fueled by news that officials from both countries plan to resume discussions.
Additional market momentum came from comments by Kevin Hassett, head of the National Economic Council, indicating that the U.S. may ease certain export restrictions on China in exchange for reduced controls on rare earth metal exports from Beijing.
The positive sentiment was further supported by an uptick in mergers and acquisitions activity. Qualcomm announced a $2.4 billion acquisition of British firm Alphawave IP, while IonQ revealed plans to purchase Oxford Ionics in a $1.075 billion deal. These developments drove growth in the technology sector, particularly among semiconductor manufacturers.
Sector Drivers and Corporate Highlights
Semiconductor stocks rallied strongly: AMD, Qualcomm, ARM, and ON Semiconductor gained over 4%, Texas Instruments rose more than 3%, and Intel, Micron, ASML, and NXP advanced by around 2%. On the downside, AppLovin plunged more than 8% following disappointing news that it would not be added to the S&P 500. Intuitive Surgical dropped over 5% after a downgrade by Deutsche Bank.
Other notable movers included Goodyear, which jumped over 10% after an upgrade from BNP Paribas, and eToro, which rose more than 10% following a positive rating from Mizuho.
Losses were also seen: Sunnova Energy filed for bankruptcy, causing its stock to crash by 38%. The insurance sector came under pressure, with Aon, Allstate, Marsh & McLennan, and others falling between 2% and 4%.
Macroeconomic Outlook and Weekly Expectations
Despite local optimism, macroeconomic data from China tempered enthusiasm. Chinese exports in May rose just 4.8% year-over-year, missing forecasts of 6%, while imports fell by 3.4% against expectations of a 0.8% decline. This stoked fears of a global economic slowdown.
Investors are now eyeing upcoming U.S. consumer price index (CPI) data for May, expected at 2.5% year-over-year, with core CPI projected at 2.9%. Weekly jobless claims and the University of Michigan’s preliminary consumer sentiment index will also be closely watched.
Markets currently see a 0% chance of a rate cut at the upcoming FOMC meeting on June 17–18.
Bonds and Yields
The 10-year U.S. Treasury yield fell by 2 basis points to 4.48%, despite oil prices climbing to a 2.25-month high, which could have raised inflation expectations. Weak trade data from China and hopes for lower tariffs helped sustain demand for government bonds.
In Europe, yields also declined: 10-year German bonds dropped to 2.567%, and U.K. gilts fell to 4.632%. Comments from ECB Governing Council member Kazimir that the rate-cutting cycle is nearly complete—or already over—added to the market’s caution.
Global Markets
Global stock exchanges closed mixed: the Euro Stoxx 50 slipped 0.16%, while China’s Shanghai Composite rose 0.43%, and Japan’s Nikkei 225 gained 0.92%.
Despite ongoing uncertainty, equity markets continue to show resilience, supported by improving U.S.–China trade relations, robust M&A activity, and a rebound in the tech sector. However, weak Chinese data and cautious inflation expectations remain headwinds to more aggressive growth.