The S&P 500 posted gains, closing at its highest level since February. Investors were encouraged by the announcement that U.S. and Chinese trade representatives will meet in London on Monday to discuss the ongoing trade tensions between the two countries. President Donald Trump expressed optimism about the upcoming talks after speaking with Chinese President Xi Jinping for 90 minutes on Thursday.
“The meeting should go very well,” Trump said in a post. The Dow Jones Industrial Average rose 443.13 points, or 1.05%, to close at 42,762.87. The S&P 500 gained 1.03%, settling at 6,000.36, while the Nasdaq Composite rallied 1.20%, ending at 19,529.95.
A better-than-expected jobs report also supported the market’s climb. The U.S. economy added 135,000 nonfarm payrolls in May, above the Dow Jones forecast of 125,000.
Strong jobs data boosts S&P 500
The unemployment rate remained unchanged at 4.2%. “While job growth decelerated in May, the payroll data came in above expectations,” said Glen Smith, CIO at GDS Wealth Management. Bond yields rose on Friday as traders dialed back their expectations for rate cuts from the Federal Reserve this year.
The odds of a rate cut in July fell to 16% from 30% the day before, with traders now looking to September for the next potential rate cut. Tesla shares had a significant rebound, rising 3.67% after plummeting 14% the previous day following a social media exchange between Trump and CEO Elon Musk. Investors are closely monitoring the progress of the U.S.-China trade talks, which have significant implications for global trade dynamics and market stability.
“There are no signs of a summer break from tariff drama,” analysts at JPMorgan Chase noted. The S&P 500 has seen its best monthly gain since November 2023, up approximately 1.5% so far this month. Both trade talks and tariffs are likely to remain at the forefront, with the market remaining vigilant for further policy surprises.
