Markets Steady as U.S.-China Trade Talks and Key Inflation Data Take Center Stage

 Image Source : Krish Capital Pty Ltd

Index Update: U.S. and Chinese officials are set to hold trade talks in London, following a recent call between Presidents Trump and Xi. Key U.S. inflation data, including the Consumer Price Index and Producer Price Index, will be released this week, along with a new consumer sentiment reading. In corporate news, Apple’s 2025 Worldwide Developers Conference begins, drawing investor focus. Last week, major U.S. indexes posted their second consecutive weekly gains, with the Dow up 1.17%, the S&P 500 rising 1.5%, and the Nasdaq climbing 2.18%.

Market Movers: On Friday, the top gainers were Hennessy Capital Investment Corp. (+173.86%), followed by Phathom Pharmaceuticals, Inc. (+90.19%). On the contrary IN8bio, Inc (-96.14%) and Marwynn Holdings, Inc. (- 71.04%) declined the most the same day.

Commodities Update: Oil prices held most of last week’s gains, supported by renewed optimism over US-China trade talks and geopolitical tensions. Both WTI and Brent crude prices were buoyed by hopes that easing trade tensions could boost global demand, while Russia’s recent missile strikes on Ukraine heightened concerns about prolonged sanctions on Russian energy exports, tightening supply. A strong US jobs report further eased fears of an economic slowdown that could dampen oil demand. Meanwhile, precious metals saw mixed movement. Gold prices steadied after recent declines as investors awaited further developments in US-China negotiations, with reduced expectations for imminent Fed rate cuts following the strong US jobs data. Silver prices surged to 13-year highs, driven by safe-haven demand amid trade uncertainties and strong industrial use, particularly in solar energy, amid a continuing global supply deficit.

Macro Update: Senior U.S. and Chinese officials are set to begin new trade talks in London, aiming to ease tensions after both countries agreed to reduce tariffs last month. Key topics include China's rare earth exports, which the U.S. wants restored to pre-April levels, and other issues such as U.S. restrictions on Huawei and Chinese students. While China has approved some rare earth export applications, details remain unclear. The current tariff pause expires in July, with the U.S. threatening steep tariffs if no deal is reached.

Futures Update: U.S. stock index futures remained largely flat amid investor caution ahead of upcoming trade talks between the U.S. and China and key inflation data due later in the week. Wall Street’s main indexes closed higher previously, supported by strong U.S. labor market data and news of a meeting between U.S. and Chinese officials. However, risk sentiment was dampened by growing civil unrest in Los Angeles following the deployment of the national guard in response to protests against U.S. immigration policies.

After a mostly lower and volatile session on Thursday, stocks saw a significant rebound during Friday’s trading. The S&P 500 increased by 61.08 points, or 1.03%, closing at 6,016.87. Technical indicators indicate that the index found support at important levels and regained the 6,000 mark, suggesting the possibility of short-term gains. Moreover, the price is trading above its key moving averages, which bolsters a positive outlook, and the 14-period RSI remains in bullish territory, further supporting an optimistic bias. Support levels are roughly around 5,888, with resistance anticipated near 6,066.