Wall Street Gains on “Positive” EU-US Trade Talks

After markets remained closed on Monday due to Memorial Day, US stocks jumped on Tuesday in response to “positive” progress on US-EU trade talks and stronger-than-expected consumer confidence data. Keep reading to find out more about this and other news.

US Stocks Move Higher

Last week, on Friday, US President Donald Trump took to social media to announce that trade negotiations with the EU were “going nowhere” and, consequently, he was “recommending a straight 50% Tariff” on EU exports from 1 June.

Predictably, the markets reacted poorly to the news on Friday. However, two days later, the president was rowing back on his threats.  

On Sunday, President Trump said that he would delay the new tariffs until 9 July following a “very nice call” with European Commission President Ursula von der Leyen. On Monday, he further noted “positive” progress with the EU on trade talks. 

Following Friday’s steep losses, European stocks advanced on Monday in response to the president’s comments. The Germany 40 index and France’s CAC40 closed 1.68% and 1.21% higher respectively, whilst the pan-European Stoxx 50 index gained 1.29%.

On Tuesday, US markets, which had been closed due to Memorial Day on Monday, followed Europe’s lead. The Dow Jones, S&P 500 and the Nasdaq gained 1.78%, 2.05% and 2.47% respectively with big tech stocks leading the gains.

Besides the apparent progress on EU-US trade talks, US stocks were also buoyed by the Conference Board’s latest US consumer confidence data. The Consumer Confidence Index rose significantly more than expected in May, after five consecutive months of decline. 

Oil Prices Inch Upwards

Oil prices rose slightly on Wednesday morning following news that the US government has blocked Chevron from exporting oil from Venezuela, under a new asset authorisation.

This, and reports that President Trump is mulling new sanctions on Russia, have raised concerns regarding supply. However, oil price gains were tempered by expectations that OPEC+ will boost output again at a meeting later this week.

Traders will also be watching the American Petroleum Institute’s weekly inventory report, which will be released later today.

Later Today

Today will also see two other important announcements.

Firstly, the Federal Open Market Committee (FOMC) will release the minutes from its meeting earlier this month in which it decided to hold interest rates steady. The minutes offer a detailed insight into the FOMC's rate-setting meeting and its stance on monetary policy, as well as potentially providing clues regarding future rate decisions.

Then, once the US markets close, Nvidia will release quarterly earnings results, in which analysts expect revenue and earnings growth. However, investors will be paying particular attention to any information on how much US-China trade tensions could affect the AI company’s outlook.

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