Optimism About Trade Talks Contributing To Recovery Rally On Wall Street

Stocks have moved sharply higher during trading on Tuesday, regaining ground following the nosedive seen late last week and early in Monday’s session. The major averages have all shown strong moves to the upside after ending yesterday’s highly volatile session mixed.

Currently, the major averages are just off their highs of the session. The Nasdaq is up 665.55 points or 4.3 percent at 16,268.82, the S&P 500 is up 184.70 points or 3.7 percent at 5,246.95 and the Dow is up 1,321.11 points or 3.5 percent at 39,286.71.

The significant rally on Wall Street may partly reflect optimism about negotiations on President Donald Trump’s new tariffs that could help avoid a global trade war.

Treasury Secretary Scott Bessent said approximately 70 countries have approached the White House about trade talks, with Japan purportedly getting priority status.

“I think you are going to see some very large countries with large trade deficits come forward very quickly,” Bessent said during an interview on CNBC. “If they come to the table with solid proposals, I think we can end up with some good deals.”

Trump also said in a post on Truth Social that he had a “great call” with South Korea’s acting President Han Duck-soo and said the country’s “top TEAM is on a plane heading to the U.S., and things are looking good.”

Traders may also be looking to pick up stocks at reduced levels following the recent nosedive, which saw the major averages hit their lowest intraday levels in over a year on Monday before regaining ground.

Sector News

Semiconductor stocks are extending the substantial rebound seen in the previous session, with the Philadelphia Semiconductor Index soaring by 4.9 percent after hitting its lowest intraday level in well over a year in early trading on Monday.

Considerable strength is also visible among gold stocks, as reflected by the 4.3 percent spike by the NYSE Arca Gold Bugs Index. The rally by gold stocks comes amid a significant rebound by the price of the precious metal.

Banking stocks have also shown a particularly strong move to the upside on the day, driving the KBW Bank Index up by 4.2 percent.

Software, brokerage and retail stocks are also seeing notable strength, moving higher along with most of the other major sectors.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved sharply higher during trading on Tuesday. Japan’s Nikkei 225 Index spiked by 6.0 percent, while China’s Shanghai Composite Index jumped by 1.6 percent.

The major European markets have also shown strong moves to the upside. While the German DAX Index is up by 3.2 percent, the U.K.’s FTSE 100 Index and the French CAC 40 Index are both up by 3.6 percent.

In the bond market, treasuries are extending the sharp pullback seen in the previous session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 7.8 basis points at 4.235 percent.

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