U.S. Stocks Climb on Trade Talk Optimism

The US and China moved to de-escalate trade tensions by agreeing on a framework for a potential trade agreement, which investors hoped would pave the way toward resolving the damaging trade war between the world’s two largest economies. Despite the optimistic tone from US and Chinese officials following two days of talks aimed at defusing trade tensions, financial markets showed muted enthusiasm for the developments.

The NFIB Small Business Optimism Index in the US increased to 98.8 in May 2025, the highest level in three months, up from 95.8 in April. The Trump administration will propose scrapping climate mandates from the Biden era that require the nation’s power plants to curb greenhouse gas emissions.

The dollar edged higher marginally, and gold rose 0.4%. Yields on 10-year Treasuries dipped about one basis point to 4.46%, ahead of Wednesday’s US inflation reading. Asian stocks inched higher after Chinese and US official s struck an optimistic tone following a second day of talks aimed at easing trade tensions. Equity-futures contracts for the S&P 500 and Nasdaq 100 remained flat.

After rising sharply during the latter part of last week, the Nifty consolidated for the second consecutive session yesterday, closing flat at 25104. The positional trend remains bullish, with support seen in the 24900-25000 band for the Nifty. On the upside, the 25,200 level could offer immediate resistance, as the market looks to digest recent gains. Indian markets are likely to open mildly higher on optimism about US-China trade talks.

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Source: HDFC Securities Prime Research