Nasdaq 100 Soars To 21,797, S&P 500 Holds 6,005, Dow Flat At 42,761 — Wall Street On Edge Over US-China Talks, CPI

Nasdaq, S&P 500, Dow Jones Futures Hover As U.S.-China Trade Talks Enter Day Two

Nasdaq futures (NQ=F) held near 21,845.75, the S&P 500 futures (ES=F) edged up to 6,016.25, and the Dow Jones Industrial Average futures (YM=F) hovered at 42,798.00 early Tuesday as U.S.-China trade talks resumed in London. While negotiators remain optimistic, the fragile sentiment was reflected in flat equity futures and a cautious stance from global investors.

CPI Report Looms Large As Market Awaits Inflation Signals

Investors are bracing for the May Consumer Price Index (CPI) due Wednesday, a key data point expected to influence market direction. Analysts project a slight uptick in price pressures following recent volatility linked to President Trump's shifting tariff policies. With inflation readings driving bond yields and equity valuations, the CPI print could spark notable market moves.

Chinese Stocks Show Volatility Amid Trade Negotiation Headlines

Chinese equities exhibited sharp swings during Tuesday's session. The Hang Seng China Enterprises Index dropped 0.2% after an initial 0.5% gain. The CSI 300 Index reversed to close 0.5% lower. Commentary from state media calling for the U.S. to revoke punitive measures heightened uncertainty among traders, contributing to intraday volatility.

S&P 500 And Nasdaq Maintain Momentum On Tech Optimism

The S&P 500 gained 0.09% Monday to close at 6,005.88, maintaining its three-month high, while the Nasdaq Composite climbed 0.31% to 19,591.24. Tech optimism remains a key driver, with Citigroup noting increased long positions in the Nasdaq 100 (NDX) versus the broader market. Apple (AAPL) slipped 1.2% post-WWDC, while Nvidia (NVDA) and Taiwan Semiconductor (TSM) advanced on AI and chip-related strength.

Dow Jones Industrial Average Remains Range-Bound

The Dow Jones Industrial Average settled marginally lower, down 1.11 points at 42,761.76. Dow components such as McDonald's (MCD) faced headwinds after a downgrade by Morgan Stanley, while Boeing (BA) and Caterpillar (CAT) remained sensitive to trade developments.

Small Business Optimism Rebounds Amid Trade Truce

The NFIB Small Business Optimism Index rose to 98.8 in May, the first increase since September. Easing tariff concerns and expectations tied to President Trump's tax-and-spending proposals buoyed sentiment. The survey underscores resilience among smaller enterprises despite ongoing policy uncertainty.

Apple's WWDC Unveils Software Revamp But AI Disappointment Weighs

Apple's WWDC introduced the new "Liquid Glass" operating system and updates across its ecosystem. However, limited new AI features left investors cautious. Apple's stock traded at $201.45, down 1.21%, as the market digested the announcements.

Tesla Rebounds Amid Robotaxi Hype

Tesla (TSLA) surged 4.55% to $308.58 on Monday and extended gains premarket to $316.08. Anticipation builds ahead of its June 12 robotaxi test in Austin, Texas, with retail enthusiasm offsetting recent analyst downgrades.

U.S.-China Trade Talks Fuel Hopes For Export Progress

Commerce Secretary Howard Lutnick signaled optimism, noting trade discussions were "going well." Rare earth exports and semiconductor access remain focal points. Chip stocks rallied Monday, contributing to broader market strength.

U.S. Treasury Auctions And Inflation Data In Focus

The Treasury will auction $58 billion in three-year notes Tuesday, with 10- and 30-year auctions slated later in the week. Market participants remain vigilant as inflation data and auction results may drive bond yields and risk sentiment.

Corporate Buybacks Support Market Rebound

LPL Financial reported corporate buybacks of $750 billion YTD, providing a demand tailwind during the recent equity recovery. Share repurchases helped reinforce the S&P 500's resilience amid tariff-driven volatility.

Asian Retail Flows Into U.S. Stocks Cool

Data shows Asian retail investors, previously aggressive dip buyers during April's tariff slump, reduced U.S. equity exposure in May. South Korean and Japanese retail accounts turned net sellers, while Singaporean participation dropped 25%. The shift highlights a cautious tone among global retail participants.

Geopolitical And Macro Risks Remain In Play

While U.S.-China talks buoy near-term sentiment, geopolitical risks and inflation concerns continue to shadow the outlook. The VIX hovered near 17.34, below its long-term average, reflecting cautious optimism but not complacency.

Buy, Sell Or Hold Verdict Across Major Indices

Given the current data backdrop, S&P 500 and Nasdaq trends warrant a tactical Buy stance, underpinned by robust tech leadership and supportive buyback activity. The Dow Jones remains a Hold, pending further clarity from trade outcomes and inflation readings. Investors should monitor evolving tariff dynamics and CPI trends closely, as they will shape risk appetite across indices in the coming sessions.

That's TradingNEWS