Wall Street climbs as China plans stimulus, investors eye US-China talks and Fed policy

US Stocks rose on Wednesday as investors welcomed new efforts by China to support its economy and looked ahead to upcoming trade talks between Washington and Beijing.The S&P 500 gained 0.4% in afternoon trading, while the Dow Jones Industrial Average added 375 points, or 0.9%, as of 1:12 p.m. Eastern. The Nasdaq composite was mostly unchanged, held back by losses in several major technology stocks.Broad gains were seen across sectors, with approximately 85% of S&P 500 components advancing. However, the rise was tempered by sharp declines in tech heavyweights—Google dropped 3.8% and Apple lost 1.8%.Shares of The Walt Disney Co. surged 10.8% after the company topped analyst earnings expectations, raised its profit forecast, and announced it had added more than a million new streaming subscribers.The upbeat report from Disney came amid broader investor concerns that new tariffs could dent consumer spending, posing risks for industries tied to discretionary spending such as entertainment and travel.President Donald Trump’s unpredictable trade policies have led many companies to cut or withdraw their financial forecasts for the year.Super Micro Computer fell 6.6% after the server manufacturer reduced its revenue forecast due to economic uncertainty. Meanwhile, chipmaker Marvell Technology declined 9.4% after postponing its planned investor day because of similar concerns.Tech firms remain particularly vulnerable to the escalating trade dispute between the US and China. Tariffs on Chinese goods have reached 145%, while China’s tariffs on US goods now stand at 125%.Still, there’s potential for progress. Top US officials are scheduled to meet with a high-level Chinese delegation in Switzerland this weekend. At the same time, China is preparing to cut interest rates and take additional steps to mitigate the economic strain caused by the ongoing tariff battle.Wall Street is also anticipating the Federal Reserve’s next move on interest rates. The central bank is expected to keep its benchmark rate unchanged. Fed Chair Jerome Powell and other officials have signaled they are waiting to assess how tariffs might affect inflation and economic activity.The Fed cut rates three times in 2024 as inflation neared its 2% target, but has since adopted a more cautious stance due to persistent inflation slightly above that level and renewed trade-related risks.“The Fed wants to see how tariffs impact consumer prices and the economy,” analysts noted.In March, the US trade deficit hit a record $140.5 billion as consumers and businesses ramped up imports ahead of tariffs scheduled for April and postponed levies set to take effect in July. The US economy contracted at an annual rate of 0.3% in the first quarter, driven in part by the import surge. Consumer confidence has also declined in recent weeks.Despite those challenges, employment remains solid—though the latest data does not yet reflect the full impact of the upcoming tariffs.Treasury yields remained relatively stable. The yield on the 10-year Treasury slipped to 4.28% from 4.30% on Tuesday.European markets mostly retreated, while shares in Asia rose earlier in the day.