New York Stocks Flat as US-China Trade Talks Resume; Key Inflation Data Due This Week

US and China Begin Second Round of High-Level Trade Talks in London
Focus Expected on Lifting Export Controls Rather Than Tariffs
May CPI and PPI to Be Announced This Week
June University of Michigan Consumer Sentiment Index Also in Focus
Baird Downgrades Tesla Investment Rating Amid 'Trump Conflict'

The three major indices on the New York Stock Exchange were mixed in early trading on June 9 (local time), hovering near the flatline. Investors are closely watching the second round of high-level trade talks between the United States and China, which began in London, UK, on this day, leading to a wait-and-see mood in the market.

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As of 10:32 a.m. on the same day at the New York Stock Exchange, the blue-chip Dow Jones Industrial Average (Dow) was down 78.96 points (0.18%) at 42,683.91 from the previous session. The large-cap S&P 500 index was up 11.38 points (0.19%) at 6,011.74, while the tech-heavy Nasdaq index was trading at 19,636.45, up 106.5 points (0.55%).

The United States and China resumed high-level trade negotiations in London on this day. This is the second round of talks, following the first meeting held last month in Geneva, Switzerland. Previously, during the Geneva negotiations, the two countries agreed to lower tariffs on each other's goods by 115 percentage points. China also agreed to withdraw certain non-tariff measures, such as the suspension of rare earth minerals and permanent magnets exports to the United States. However, the United States later claimed that China was still maintaining export controls on critical minerals and rare earths, thus violating the agreement. In response, President Donald Trump and Chinese President Xi Jinping discussed the issue directly in a phone call on June 5, which led to the second round of high-level trade talks beginning on this day. Both sides are expected to focus on the removal of export control measures, which is a key concern for industry players, rather than tariffs, as a main agenda item in these negotiations.

On Wall Street, expectations are rising that the current talks will ease tensions surrounding the US-China trade conflict. Previously, all three major New York stock indices ended last week with gains for the second consecutive week. The S&P 500, the leading US stock index, surpassed the 6,000 mark on June 6 for the first time since the end of February.

Chris Verrone, chief market strategist at Strategas, analyzed, "This rally shows that concerns about tariffs and the US economy are easing among many traders and investors." He added, "The most important thing is that cyclical stocks continue to perform well. When cyclical stocks hit new highs compared to defensive stocks, it means the overall economy is in good shape."

This week, several key inflation indicators will be released. The Consumer Price Index (CPI) for May, to be announced on June 11, is expected to rise 2.5% year-on-year, with the increase widening compared to April's 2.3%. The Producer Price Index (PPI), known as the "wholesale price," will be released the following day, June 12. The May PPI is projected to rise 0.2% from the previous month, marking a turnaround from April's 0.5% decline. The PPI affects the CPI, or "retail price," with a time lag. Investors are expected to use these indicators to assess the impact of President Trump's tariff policies on inflation. On June 13, the University of Michigan Consumer Sentiment Index and inflation expectations will be announced.

Government bond yields are steady. The yield on the benchmark 10-year US Treasury note is at 4.5%, unchanged from the previous session, while the yield on the policy-sensitive 2-year Treasury note is at 4.01%, down 2 basis points (1bp = 0.01 percentage point) from the previous session.

By stock, Warner Bros. Discovery surged 7.28% on news that the company will split into two listed firms by next year, with one handling streaming services and film content, and the other overseeing cable networks. Tesla is down 0.39% after Baird downgraded its investment rating from "buy" to "neutral." Baird explained that its downgrade was due to Tesla's robotaxi plans being overly optimistic, and that clashes between CEO Elon Musk and President Trump are adding significant uncertainty to the company. Nvidia is up 2.06%, and Apple is up 0.72%.