Stocks mostly rise following Trump-Kim summit

Stocks mostly rose in a quiet Tuesday session, as investors reacted calmly to the outcome of a meeting between President Trump and North Korean leader Kim Jong Un, and turned their attentions to this week’s trio of central bank meetings.

The Standard & Poor’s 500 index rose 0.2 percent, to 2,786.85, closing at its highest level since Feb. 1. The Nasdaq Composite added 0.6 percent, to 7,703.79, and the Dow Jones industrial average fell less than 0.1 percent, to 25,320.73. The Russell 2000, an index of mostly small companies, rose 0.5 percent, to 1,682.30.

Both the Russell and the Nasdaq set record highs.


Trump and Kim concluded their summit by committing to working ‘‘toward complete denuclearization of the Korean Peninsula’’ and to ‘‘build a lasting and stable peace regime’’ on the Korean Peninsula.

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The broad promises largely reiterated past agreements, while many of the details were left vague and there was no agreement on ending the technical state of war between North and South Korea. A potential deal has the chance of lowering geopolitical tensions in a region surrounded by three of the world’s largest economies: those of Japan, China, and South Korea.

Shares of weapons makers and defense contractors were among the biggest decliners in the S&P 500. Raytheon lost nearly 3 percent, Lockheed Martin fell 1.3 percent, and Northrop Grumman fell 1.5 percent.

With geopolitical issues set aside, investors turned their attention to the US economy.

The Federal Reserve started a two-day meeting on interest rates Tuesday. Investors expect the central bank to raise its benchmark rate by a quarter of a percentage point to a range of 1.75 to 2 percent. However, investors’ attention will focus more on how many additional rate hikes Fed officials may approve this year.


The government said US consumer prices rose 0.2 percent in May, with surging gasoline costs driving much of the increase. The Labor Department said Tuesday that the consumer price index climbed 2.8 percent last month from a year earlier, putting inflation on its fastest annual pace since February 2012. But core prices — which exclude the volatile food and energy categories — have risen a milder 2.2 percent over the past 12 months.

Fed officials have been closely watching inflation data, since they have a target of inflation being roughly 2 percent per year. Since core inflation is still tame, that’s likely to mean that the Federal Reserve will raise interest rates only gradually.

On Thursday, the European Central Bank will meet and could outline an end to its stimulus program, while on Friday the Bank of Japan is due to give its latest policy update.

After the market close, investors welcomed news the $85 billion merger of AT&T and Time Warner will be allowed. The Trump administration had sued to block it and a rejection probably would have chilled possible multibillion-dollar deals between 21st Century Fox and Walt Disney; Verizon and CBS; and T-Mobile and Sprint.

Following the judge’s decision, shares of Time Warner rose 4 percent and AT&T fell 2 percent.


Shares of Tesla rose 3 percent after the company said it would lay off 9 percent of its workforce to boost profitability.

Benchmark US crude closed up 26 cents to $66.36 a barrel. Brent crude, used to price international oils, fell 69 cents to $75.77.