The New York stock market closed mixed on Tuesday as investor sentiment was rattled by a surprise economic contraction in the U.S., yet buoyed by renewed optimism over U.S.-China trade negotiations.
On April 30 (Eastern Time), the Dow Jones Industrial Average rose 141.74 points (0.35%) to close at 40,669.36. The S&P 500 added 8.23 points (0.15%) to end at 5,569.06, while the Nasdaq Composite slipped 14.98 points (0.09%) to finish at 17,446.34.
The market was initially shaken by a report showing that U.S. gross domestic product (GDP) shrank in the first quarter for the first time in three years. The Commerce Department announced that preliminary seasonally adjusted GDP declined at an annualized rate of -0.3% quarter-over-quarter, a significant slowdown from the 2.4% growth in Q4 of last year. This marked the first quarterly contraction since Q1 of 2022.
Following the report, all three major indices opened sharply lower, with the Nasdaq plunging as much as 2.87% during the session. However, dip-buying gained momentum later in the day, helping to pare earlier losses.
The downturn in GDP had been anticipated by several major Wall Street institutions. JPMorgan recently revised its Q1 forecast to -1.5%, while Jefferies predicted -0.2% and BNP Paribas forecast -0.6%.
Sentiment improved in the afternoon on reports suggesting progress in U.S.-China trade discussions. Chinese state media outlet “Weiyuantantian,” affiliated with CCTV, posted that the U.S. has been actively reaching out to China through various channels to discuss tariff issues.
The report prompted a brief rally, with the S&P 500 surging nearly 30 points before paring gains as the U.S. government made no official comment. Nonetheless, the optimism lingered through the session.
By sector, consumer discretionary stocks fell around 1%, and energy dropped over 2%. Communication services and utilities also ended lower.
The CBOE Volatility Index (VIX), Wall Street’s fear gauge, climbed 0.53 points (2.19%) to 24.70.
