Stocks notched comfortable gains Monday as market participants cheered President Donald Trump’s upbeat commentary on U.S.-China trade negotiations. Market participants also looked ahead to this week’s Fed meeting, where the central bank is expected to issue its first rate cut of the year.
At the close, the tech-heavy Nasdaq Composite was up 0.9% at 22,348 and the broader S&P 500 had added 0.5% to 6,615 – new record closing highs – while the blue chip Dow Jones Industrial Average tacked on 0.1% to 45,883.
Trade talks between top officials from the United States and China continued for a second day today, with President Trump posting on his Truth Social account that the “big Trade Meeting … has gone VERY WELL!”
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more – straight to your e-mail.
Profit and prosper with the best of expert advice – straight to your e-mail.
In the same post, Trump wrote that, “A deal was also reached on a ‘certain’ company that young people in our Country very much wanted to save. They will be very happy!”
He is likely referring to TikTok, whose parent company ByteDance had a September 17 deadline to either divest the popular social media platform or be forced to shut down its operations in the U.S. Trump noted that he will meet with Chinese President Xi Jinping this Friday to discuss the terms of the deal.
Trump chimes in on rate cuts ahead of the September Fed meeting
President Trump also took to Truth Social to weigh in on interest rates ahead of the September Fed meeting. “‘Too Late’ MUST CUT INTEREST RATES, NOW, AND BIGGER THAN HE HAD IN MIND. HOUSING WILL SOAR!!!,” Trump wrote ahead of Monday’s opening bell.
According to CME FedWatch, futures traders are pricing in a 96% chance the Federal Open Market Committee (FOMC) will cut rates by a quarter-percentage point this time around.
While odds for a larger half-percentage-point cut have risen slightly over the past month – to 4% from zero in mid-August – Jonathan Millar, senior U.S. economist at Barclays, says that it’s doubtful the FOMC will lower the federal funds rate by 50 basis points.
“Incoming data portray a slowed labor market that is not collapsing, and still-gradual upward price pressures from tariffs,” Millar writes in a note. “Even with Stephen Miran likely injecting a dovish voice [this] week, the Fed seems on course for sequential 25 basis-point rate cuts through end-2025, with jumbo cuts unlikely.”
Nvidia falls on China’s anti-monopoly accusations
In single-stock news, Nvidia (NVDA) shares slipped 0.04% today after China said the artificial intelligence (AI) chipmaker violated the country’s anti-monopoly law in its 2020 acquisition of Israeli data center solutions provider Mellanox.
The results of the preliminary investigation were released as the U.S. and China began trade negotiations, and Treasury Secretary Scott Bessent said the two countries “discussed the poor timing of the Nvidia investigation the day of these talks.”
A spokesperson for Nvidia said that the company complies “with the law in all respects,” and that it “will continue to cooperate with all relevant government agencies as they evaluate the impact of export controls on competition in the commercial markets.”
Tesla pops after Musk’s $1 billion stock buy
Tesla (TSLA) was another notable mover today. The Magnificent 7 stock was up more than 7% at its intraday high before paring this gain to 3.6% after CEO Elon Musk disclosed a big share purchase.
According to a regulatory filing, Musk bought 2.57 million TSLA shares on Friday for roughly $1 billion. This is his biggest insider stock acquisition ever, according to CNBC, and his largest purchase since 2020.
In other Tesla news, Wedbush analyst Daniel Ives reiterated his Outperform (Buy) rating and $500 price target on the consumer discretionary stock – representing implied upside of 22% to current levels.
“We believe Tesla and Musk are heading into a very important chapter of their growth story as the AI Revolution takes hold and the Robotaxi opportunity is now a reality on the doorstep,” Ives wrote in a September 14 note.
Ives added that Musk’s new pay plan, which was announced earlier this month, “was a relief for investors as this will confirm Musk stays CEO of Tesla at least until 2030 in our view as Musk remains the most important asset to Tesla and the Board made the smart and right move.”
