China Trade Tensions Threaten to Derail S&P 500's Winning Streak!

S&P 500 Dips as China Trade Tensions Resurface, Capping Off a Strong Month for Markets

New York City – After a month of significant gains, the S&P 500 experienced a wavering close on Friday, as renewed trade war anxieties tempered investor enthusiasm. This comes after President Trump accused China of breaching their preliminary trade agreement, injecting fresh uncertainty into the market.

The broad-based index finished near flat after an initial tumble of over 1%. Similarly, the Nasdaq Composite edged down by 0.4%. The Dow Jones Industrial Average managed a gain of 107 points, recovering from a steeper drop of more than 300 points earlier in the session.

May's Market Performance: A Month of Solid Gains

Despite Friday's volatility, stocks are set to conclude May with impressive gains, a welcome contrast to a turbulent April. A key driver of this rally was the recently announced trade deal between the U.S. and the United Kingdom, fueling hopes for similar agreements with other nations facing tariffs.

• The S&P 500 has risen by over 5% this month.
• The Nasdaq has surged by 9.5% during the same period.
• Both indexes are on pace for their best monthly performance since November 2023.
• The Dow has increased by 3% in May.

For the week, the S&P 500 is up by 1.5%, the Dow by 1%, and the Nasdaq by 1.9%.

Trade War Fears Resurface

The day's market jitters were sparked by a social media post from President Trump alleging that China had "violated" its existing trade agreement with the U.S. This followed comments from Treasury Secretary Bessent in a Fox News interview, indicating that U.S.-China trade discussions "are a bit stalled." Adding to the unease, a Bloomberg report suggested that the administration is considering expanding restrictions on China's tech sector.

Adding to the complexities, the administration's contentious tariff plan faces legal challenges. Investors are increasingly questioning the likelihood and timing of a long-term agreement between the U.S. and China.

Legal Battles Add to Market Uncertainty

The legal landscape surrounding tariffs became more complicated after the Court of International Trade temporarily halted a significant portion of President Trump's tariffs on Wednesday night. While an appeals court granted a stay on Thursday, allowing the tariffs to remain in effect until next week, the situation remains fluid.

Reports also surfaced indicating the Trump administration's consideration of utilizing a provision of the Trade Act of 1974 to potentially impose tariffs of up to 15% for a 150-day period, as reported by The Wall Street Journal.

Analyst Perspective

"It's an awkward time," observed Jay Hatfield, CEO of Infrastructure Capital Management. "If you're an investor, you want to bet on good earnings, not good tweets about tariffs."

Looking Ahead

As the market navigates these uncertainties, investors are closely monitoring developments in U.S.-China trade relations and the legal challenges surrounding tariffs. The balance between positive earnings reports and potential trade-related headwinds will likely shape market performance in the coming weeks. While May delivered strong gains, the resurfacing of trade tensions serves as a reminder of the fragility of the current economic landscape.

Tags: Stock market, NYSE, S&P 500, Dow Jones, Nasdaq, Trade war, US-China trade, Market gains, May 2025, Stock trading

Source: https://www.cnbc.com/2025/05/29/stock-market-today-live-updates-.html