Bond & Stocks
Wall Street traders put stocks on pace to notch fresh all-time highs amid optimism that artificial intelligence and Federal Reserve rate cuts will keep powering Corporate America. A slide in gold deepened. Bonds edged lower. Equities rose in early New York trading, with the S&P 500 set to extend its advance into a fourth straight day. Microsoft Corp. jumped after finalizing a new agreement in a long-negotiated partnership with and OpenAI. Under the new pact, the software giant will get a 27% ownership stake worth about $135 billion. That’s added to optimism about the industry ahead of results from the company four other big techs this week — Alphabet Inc., Meta Platforms Inc., Amazon.com Inc. and Apple Inc.
Economy
Chinese and US trade negotiators have lined up an array of diplomatic wins for Donald Trump and Xi Jinping to unveil at a summit this week. Those easy hits are pleasing investors, but leave deeper core conflicts unresolved. Markets soared on the news with the MSCI’s index for global stocks testing all-time highs, but analysts cautioned the deal teed up for Trump and Xi to sign in South Korea ignored thorny issues. Fundamental fights over national security appeared untouched, they said, along with Trump’s stated core mission of rebalancing trade. Making that harder, Chinese investment into America remains heavily restricted.
World
Japan and the US unveiled a list of potential projects for their $550 billion US investment vehicle, providing a first look into what specific proposals could be funded by the mechanism that’s a key part of the two countries’ trade deal. At a signing ceremony Tuesday in Tokyo, US Commerce Secretary Howard Lutnick outlined many of the highest-profile commitments. The corporate names included SoftBank Group, Westinghouse and Toshiba Corp., and the size of the potential projects ranged from $350 million to as much as $100 billion. A fact sheet released by Japan’s trade ministry Tuesday detailed other Japanese companies interested in launching projects in areas ranging from energy and AI to critical minerals.