The three major stock indices on the New York Stock Exchange exhibited significant volatility due to the conflict surrounding the implementation of the "Geneva Trade Agreement" between the United States and China, ultimately closing mixed. U.S. President Donald Trump claimed China violated the agreement, raising risk-averse sentiment, but later expressed a willingness to resolve the issue through dialogue, leading to a stable market close.
On the 30th (local time), the Dow Jones Industrial Average closed at 42,270.07, up 54.34 points (0.13%) from the previous session on the New York Stock Exchange (NYSE). In contrast, the Standard & Poor's (S&P) 500 index fell 0.48 points (0.01%) to 5,911.69, while the Nasdaq Composite index dropped 62.11 points (0.32%) to close at 19,113.77.
The market expressed concerns about the sustainability of the recently concluded Geneva trade agreement between the U.S. and China. Trump stated on social media platform Truth Social, "The bad news is, although it may not surprise some, China has completely violated the agreement with us."
He noted, "Just two weeks ago, China was facing a serious economic crisis, but everything stabilized quickly through negotiations between the U.S. and China, only to have China violate the agreement."
In response, the Chinese Embassy in Washington issued a statement saying, "Both sides should stop discriminatory restrictions and jointly comply with what was agreed upon in the Geneva senior-level talks." Reports of potential additional sanctions against China and warning remarks from White House officials sharply dampened investor sentiment, leading to a plunge in major indices.
Reports of potential additional sanctions against China and warning remarks from White House officials sharply dampened investor sentiment, leading to a plunge in major indices.
However, in the afternoon, when Trump stated at a White House press conference, "I am confident that I will speak with President Xi Jinping of China, and I hope we can resolve this issue," bargain-hunting emerged, and the indices quickly rebounded to close within a stable range.
By sector, utility and consumer staples rose by more than 1%, while consumer discretionary, energy, and technology stocks showed declines. The Philadelphia Semiconductor Index plummeted by 2.11%, reflecting concerns over tightening sanctions on China's technology sector. Nvidia fell by 2.92%, and TSMC, ASML, AMD, Qualcomm, and Arm dropped around 2%.
The "Magnificent Seven," referring to seven major tech companies, showed a mixed performance. Tesla saw a 3.34% decline despite CEO Elon Musk holding a farewell press conference as he left the administration that day.
Retailers' stock prices were mixed. Costco rose more than 3% due to better-than-expected earnings, while Ulta Beauty surged over 11% following its "surprise earnings" and upward guidance. In contrast, Gap plummeted 20% due to disappointing quarterly revenue projections.
The Personal Consumption Expenditures (PCE) price index, which is the Federal Reserve's preferred inflation measure, showed a modest increase in April that met expectations.
According to the U.S. Department of Commerce, the core PCE price index, which excludes volatile food and energy prices, rose 0.1% in April compared to the previous month, meeting expectations. Although it rose slightly from the previous month's reading of 0.0%, the trend remained modest. The overall PCE price index also rose by 0.1% without deviating from expectations.
American consumer sentiment has shifted from a sharp decline to a wait-and-see attitude. According to the University of Michigan, the finalized consumer sentiment index for May was recorded at 52.2, consistent with April's finalized figure and above market expectations.
Joanne Shu, director of consumer surveys at the University of Michigan, explained, "In early May, consumer sentiment experienced additional declines, but showed signs of recovery after the announcement of certain tariff exemptions in mid-May."
According to the CME FedWatch Tool, the probability of the federal funds rate being held steady in July is 73.1%. This is a slight decrease compared to the previous day's closing, but the prevailing view in favor of a hold remains unchanged.
The Cboe Volatility Index (VIX) recorded a drop of 0.61 points (3.18%), closing at 18.57.