Stocks edged lower on Monday as officials from China and the U.S. prepared to meet in London. The world’s two largest economies are trying to broker a lasting trade truce, and the outcome will matter a lot for company profits.
Futures tracking the Dow Jones Industrial Average slipped 31 points, or 0.1%. S&P 500 futures fell 0.1%, and contracts tied to the tech-heavy Nasdaq 100 dropped 0.2%.
The three blue-chip indexes racked up gains to close out last week after the monthly nonfarm payrolls report showed that hiring remained steady, with the S&P 500 crossing the 6,000-point threshold for the first time since February.
Investors were likely in wait-and-see mode Monday ahead of the trade talks, although there are signs that trade tensions between Beijing and Washington are cooling: President Donald Trump said in a post on Truth Social late Friday that he believed the meeting would “go very well.” Trump’s negotiators are expected to press China to speed up exports of rare-earth minerals.
“Stocks may need a new driver to extend last week’s rally after investors scaled back their expectations for Federal Reserve interest rates cuts for this year,” said Kathleen Brooks, research director for the foreign exchange brokerage XTB. “The outcome of these discussions will be crucial for market sentiment at the start of this week.”
The yield on the 10-year U.S. Treasury note retreated 2 basis points to just under 4.5% early Monday. The U.S. Dollar Index, which tracks the greenback against a weighted basket of six other currencies, slid 0.3%.
Benchmark oil prices fell about 0.5%, and Bitcoin–the world’s largest cryptocurrency by market capitalization–dropped 0.7%.