Wall Street is flat as trade talks between China and US enter 2nd day
Early trading on Wall Street is thin with all eyes on China-U.S. trade talks in London that could have a huge impact on the global economy.
Futures for the S&P 500 and the Nasdaq each inched up 0.1% before the bell Tuesday, while futures for the Dow Jones Industrial Average were essentially flat.
A second day of talks was planned after U.S. and Chinese officials met in London on Monday for negotiations over various issues. The hope is that they can eventually reach a deal to reduce painfully high tariffs. Most of the tariff hikes imposed since U.S. President Donald Trump escalated his trade war are paused to allow trade in everything from tiny tech gadgets to enormous machinery to continue.
The S&P 500 has rallied after dropping roughly 20% from its record two months ago when Trump shocked financial markets with wide-ranging tariff threats during what he called “Liberation Day.”
Still, confusion over the potential ramifications of Trump’s sweeping tariff threats have caused a host of companies to lower or altogether pull their financial guidance. That trend continued Tuesday with Designer Brands, the owner of DSW retail shoe outlets. CEO Doug Howe blamed the company’s slow start to the year on an “unpredictable macro environment and deteriorating consumer sentiment.”
Designer Brands shares fell nearly 7.5% before the bell Tuesday after the company — which also owns the Keds and Hush Puppies brands — posted a much wider loss than analysts were expecting.
Tesla rose early Tuesday, a day after it recovered a decent chunk of its sharp, recent drop. The electric vehicle company tumbled last week as Elon Musk’s relationship with Trump imploded, but shares were up 2.3% in premarket after climbing 4.6% Monday.
McDonalds dipped 1.4% after its stock was downgraded by Morgan Stanley, which cited “structural pressures” on the fast food sector, most notably cash-strapped lower income consumers.
In Europe at midday, Germany’s DAX lost 0.3%, Britain’s FTSE 100 gained 0.5% and the CAC 40 in Paris was unchanged.
In Asian trading, Tokyo’s Nikkei 225 gained 0.3% to 38,211.51, yielding most of its earlier gains, while the Kospi in South Korea rose 0.6% to 2,871.85.
Hong Kong’s Hang Seng reversed an early advance, slipping 0.1% to 24,162.87. The Shanghai Composite index dropped 0.4% to 3,384.82.
There was no fresh news on the U.S.-China trade talks, but investors appeared to grow more nervous as the day wore on.
“Chinese stocks did what they often do when geopolitics starts tightening the noose — they flinched. What began as a calm morning session flipped into a jittery sell-off as traders returned from lunch with a different mood,” Stephen Innes of SPI Asset Management said in a commentary.
In Taiwan, the Taiex surged 2.1%.
Australia’s S&P/ASX 200 advanced 0.8% to 8,587.20. India’s Sensex was nearly unchanged.
U.S. benchmark crude oil picked up 37 cents to $65.66 per barrel. Brent crude, the international standard, was up 36 cents at $67.40.
The dollar fell to 144.53 Japanese yen from 144.61 yen. The euro ticked up to $1.1430 from $1.1421.
In the bond market, the yield on the 10-year Treasury eased to 4.45% from 4.48% late Monday.