The New York stock market ended on a positive note on Tuesday.
Investor optimism for a potential deal grew as the U.S. and Chinese negotiators continued their second day of trade talks in London.
Howard Lutnick, the U.S. Secretary of Commerce and chief negotiator, reported that discussions were progressing well.
Meanwhile, Tesla’s stock surged 5.7% amid signs of a truce in the feud between U.S. President Donald Trump and Tesla CEO Elon Musk.
Among the Magnificent Seven tech giants, all posted gains except for Microsoft, which had set record highs for eight consecutive trading days.
Three-Day Rally
The Dow Jones Industrial Average, which had closed slightly lower the previous day due to late selling pressure, joined the upward trend. This led to a broad-based rally across New York’s major indices.
The Dow finished at 42,866.87, adding 105.11 points or 0.25%.
The tech-heavy S&P 500 and the Nasdaq Composite continued their upward momentum for the third consecutive day since June 6.
The S&P 500 gained 32.93 points (0.55%) to close at 6,038.91, while the Nasdaq jumped 123.75 points (0.63%) to end at 19,714.99.
The Russell 2000, which tracks small-cap stocks, also joined the rally, climbing 11.96 points (0.56%) to finish at 2,156.41.
The CBOE Volatility Index (VIX), known as Wall Street’s fear gauge, dipped 0.21 points (1.22%) to 16.95.
Despite fluctuations, the VIX has been on a clear downward trajectory, having plummeted nearly 24% from its May 23 reading of 22.29.
Tesla’s Remarkable Rebound
Tesla’s stock has staged an impressive comeback, rallying for three consecutive days following a steep 14.3% drop on June 5.
Tesla shares surged 17.51 USD (5.67%) to close at 326.09 USD.
This rally has narrowed the stock’s decline to just 1.6% from its June 4 closing price of 332.05 USD.
The apparent reconciliation between Trump and Musk seems to be fueling Tesla’s stock surge.
Musk removed his critical tweets about Trump from his social media account, while Trump stated on Monday that he had no issues communicating with Musk.
The conflict appears to be resolving, with reports that Trump’s inner circle has been working to mediate the reconciliation.
While a full restoration of their previous relationship may be unlikely, both Trump and Musk appear committed to avoiding further conflict, signaling a potential mending of their relationship.
Microsoft’s Streak Ends
Microsoft (MS), the market’s largest company by capitalization, saw its eight-day winning streak come to an end. MS shares declined for the first time in nine trading sessions, a run that began on May 29.
After climbing 3.4% since May 28, they reached a record high of 472.75 USD on Monday.
However, on Tuesday, Microsoft’s stock retreated, closing down 1.83 USD (0.39%) at 470.92 USD.
Despite the 0.4% drop, the stock showed resilience by recovering from an intraday drop of 1.6%.
Analysts remain bullish on Microsoft’s short-term growth prospects.
Expectations for Microsoft’s short-term growth remain high, as chart analysts believe the stock has upward momentum after achieving a golden cross, a signal where the 50-day moving average crosses above the 200-day moving average.
