World shares were mixed on Tuesday as investors kept a wary eye on China-U.S. trade talks that could have a huge impact on the global economy.
Germany’s DAX lost 0.7% to 24,006.38, while the CAC 40 in Paris shed 0.2% to 7,779.45. Britain’s FTSE 100 gained 0.3% to 8,858.01.
The future for the S&P 500 was down 0.1% while that for the Dow Jones Industrial Average fell 0.2%.
A second day of talks was planned after U.S. and Chinese officials met in London on Monday for negotiations over various issues. The hope is that they can eventually reach a deal to reduce painfully high tariffs against each other. Most of the tariff hikes imposed since U.S. President Donald Trump escalated his trade war are paused to allow trade in everything from tiny tech gadgets to enormous machinery to continue.
In Asian trading, Tokyo’s Nikkei 225 gained 0.3% to 38,211.51, yielding most of its earlier gains, while the Kospi in South Korea rose 0.6% to 2,871.85.
Hong Kong’s Hang Seng reversed an early advance, slipping 0.1% to 24,162.87. The Shanghai Composite index dropped 0.4% to 3,384.82.
There was no fresh news on the talks, but investors appeared to grow more nervous as the day wore on.
“Chinese stocks did what they often do when geopolitics starts tightening the noose — they flinched. What began as a calm morning session flipped into a jittery sell-off as traders returned from lunch with a different mood,” Stephen Innes of SPI Asset Management said in a commentary.
In Taiwan, the Taiex surged 2.1%.
Australia’s S&P/ASX 200 advanced 0.8% to 8,587.20. India’s Sensex was nearly unchanged.
On Monday, the S&P 500 edged up just 0.1% and was within 2.3% of its record set in February. The Dow gave up just 1 point, which is well below 0.1%.
The Nasdaq composite added 0.3%.
Hopes that President Donald Trump will lower his tariffs after reaching trade deals with countries around the world have helped the S&P 500 has rally back after it dropped roughly 20% from its record two months ago. It’s back above where it was when Trump shocked financial markets in April with his wide-ranging tariff announcement on what he called “Liberation Day.”
Some of the market’s biggest moves came from the announcement of big buyout deals. Qualcomm rallied 4.1% after saying it agreed to buy Alphawave Semi in a deal valued at $2.4 billion. IonQ, meanwhile, rose 2.7% after the quantum computing and networking company said it agreed to purchase Oxford Ionics for nearly $1.08 billion.
On the losing side of Wall Street was Warner Bros. Discovery, which flipped from a big early gain to a loss of 3% after saying it would split into two companies.
Tesla recovered some of its sharp, recent drop. The electric vehicle company tumbled last week as Elon Musk’s relationship with Trump broke apart, and it rose 4.6% Monday after flipping between gains and losses earlier in the day.
The frayed relationship could end up damaging Musk’s other companies that get contracts from the U.S. government, such as SpaceX. Rocket Lab, a space company that could pick up business at SpaceX’s expense, rose 2.5%.
A survey by the Federal Reserve Bank of New York found that consumers’ expectations for coming inflation eased a bit in May.
Economists expect a report coming on Wednesday to show inflation across the country accelerated last month to 2.5% from 2.3%.
The Fed has been keeping its main interest rate steady as it waits to see how much Trump’s tariffs will raise inflation and how much they will hurt the economy. A persistent increase in expectations for inflation among U.S. households could drive behavior that creates a vicious cycle that only worsens inflation.
In other dealings early Tuesday, U.S. benchmark crude oil picked up 15 cents to $65.44 per barrel. Brent crude, the international standard, was up 17 cents at $67.22.
The dollar rose to 144.63 Japanese yen from 144.61 yen. The euro slipped to $1.1412 from $1.1421.
In the bond market, the yield on the 10-year Treasury eased to 4.45% from 4.48% late Monday.