WASHINGTON (dpa-AFX) - Stocks came under pressure early in the session on Monday but showed a notable turnaround over the course of the trading day. The major averages climbed well off their lows of the session and into positive territory.
The major averages saw further upside going into the end of the day, reaching new highs for the session. The Nasdaq climbed 128.85 points or 0.7 percent at 19,242.61, the S&P 500 rose 24.25 points or 0.4 percent to 5,935.94 and the Dow inched up 35.41 points or 0.1 percent to 42,305.38.
The early weakness on Wall Street partly reflected renewed trade concerns amid further signs of rising tensions between the U.S. and China.
China on Monday pushed back against President Donald Trump's claims that it had broken the Geneva trade agreement, accusing the U.S. of violating the deal with increased tech export restrictions and the revocation of Chinese student visas.
'These practices seriously violate the consensus reached by the two heads of state on January 17, seriously undermine the existing consensus of the Geneva economic and trade talks, and seriously damage China's legitimate rights and interests,' a Chinese Ministry of Commerce spokesperson said.
A collapse of the U.S.-China trade agreement could lead to considerable weakness among stocks, which have shown a considerable recovery since Trump's 'reciprocal tariff' announcement in early April.
The Trump administration has also announced it will double the current tariff rate on steel and aluminum imports from 25 percent to 50 percent.
However, selling pressure waned following the release of a report from the Institute for Supply Management showing its reading on U.S. manufacturing activity unexpectedly edged slightly lower in the month of May.
The ISM said its manufacturing PMI slipped to 48.5 in May from 48.7 in April, with a reading below 50 indicating contraction. Economists had expected the index to inch up to 49.5.
With the unexpected decline, the manufacturing PMI dipped to its lowest level hitting 48.4 in November 2024.
The report may have generated some optimism about the outlook for interest rates amid signs of U.S. economic weakness due to Trump's trade war.
The turnaround on Wall Street also came after a White House official told CNBC that Trump and Chinese President Xi Jinping could speak one-on-one 'very soon.'
Sector News
Gold stocks moved sharply higher along with the price of the precious metal, with the NYSE Arca Gold Bugs Index soaring by 6.0 percent.
Trump's increased tariffs on U.S. steel imports also contributed to substantial strength among steel stocks, as reflected by the 3.0 percent surge by the NYSE Arca Steel Index.
Semiconductor, natural gas and oil service stocks also moved notably higher over the course of the session, while some weakness remained visible among housing stocks.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Monday. Japan's Nikkei 225 Index slumped by 1.3 percent, while Hong Kong's Hang Seng Index slid by 0.6 percent.
Most European stocks also moved to the downside on the day. The German DAX Index fell by 0.3 percent and the French CAC 40 Index dipped by 0.2 percent, although the U.K.'s FTSE 100 Index closed just above the unchanged line.
In the bond market, treasuries came under pressure over the course of the session after ending last Friday's trading little changed. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, climbed 4.6 basis points to 4.462 percent.
Looking Ahead
Reports on factory orders and job openings may attract some attention on Tuesday, although developments on the trade front are likely to remain in the spotlight.
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