"The Wall of Worry Is Crumbling"… US S&P500 and Nasdaq Hit Another Record High

Optimism Rises Over Trade Negotiations

Canada Withdraws Digital Tax Under Trump Pressure

US Treasury: 'Negotiations Will Heat Up Next Week'

The New York Stock Exchange closed higher on the last trading day of June, with the S&P 500 and Nasdaq Composite Index once again reaching record highs. This was thanks to heightened expectations for the resumption of trade negotiations.

On the 30th (local time) at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average closed at 44,094.77, up 275.50 points (0.63%) from the previous session. The S&P 500 gained 31.88 points (0.52%) to close at 6,204.95, and the Nasdaq climbed 96.27 points (0.47%) to end at 20,369.73. The S&P 500 and Nasdaq indices set new historical records for the second time since the 27th. All major indices showed strength throughout June. The S&P 500 rose 5%, the Nasdaq 6%, and the Dow more than 4%. For the second quarter, the S&P 500 jumped over 10%, the Nasdaq 18%, and the Dow nearly 5%.

The market is watching the potential for easing of trade tensions between the United States and Canada. US President Donald Trump stated on the 27th that he would "immediately halt all trade talks" if Canada proceeded with the digital tax. The Canadian Department of Finance announced in a statement that it withdrew the digital services tax to make progress in its trade negotiations with the United States.

President Trump's 90-day tariff suspension is set to expire next week. The market is closely monitoring the possibility of trade agreements with major partners.

Finance Minister Scott Besant commented, "Some countries are negotiating in good faith," yet noted, "If the other party remains firm, tariffs could return to their previous levels."

Kevin Hassett, chairman of the White House National Economic Council (NEC), said, "A trade deal will move quickly if President Trump's 'big and beautiful bill' passes Congress." However, although the bill passed a procedural vote in the Senate over the weekend, its passage in the House remains uncertain due to opposition from some Republican representatives.

Terry Sandven, Chief Investment Strategist at U.S. Bank, assessed, "With inflation stabilizing and interest rates remaining range-bound, corporate earnings are on an upward trend," and, "This environment is positive for the stock market."

He observed, "The so-called 'wall of worry' is collapsing," and indicated, "There is over 2% further upside potential in the S&P 500 index by year-end."

According to the FedWatch Tool at the Chicago Mercantile Exchange (CME), the federal funds rate futures market is reflecting a 78.8% probability of no rate hike in July.

The Volatility Index (VIX) at the Chicago Board Options Exchange (CBOE) rose 0.41 points (2.51%) to 16.73.

Shin Yong-hyun, Hankyung.com journalist yonghyun@hankyung.com