Investor optimism regarding potential advancements in US-China trade negotiations has sparked a rally in the stock market, with significant contributions from major tech companies. Despite President Trump's lack of immediate plans to engage with China's President Xi, traders remain hopeful that future talks could yield positive results similar to those achieved with Canada and Mexico. This optimism is further supported by a decline in 10-year Treasury yields, which suggests reduced concerns over economic overheating and potentially lower borrowing costs for businesses. Additionally, a weakening US dollar, as indicated by a 0.7% drop in the Bloomberg Dollar Spot Index, could enhance the competitiveness of US exports, adding to the positive market sentiment.
The SPDR S&P 500 ETF (SPY) experienced a modest increase, closing at $601.66, up 0.65% from the previous close of $597.77, and currently trading at $600.72, reflecting a 0.49% rise as of 16:20 on Tuesday, February 4.