US Stocks Rally Fades As Weak Economic Data Lift Bonds: Markets Wrap

Wall Street traders cheering solid results from Nvidia Corp. had to face the harsh reality of slowing economic data as well as legal uncertainties around President Donald Trump’s trade war.

The S&P 500 trimmed an advance that earlier approached 1%. That’s even after the world’s largest chipmaker soothed investor fears about a China cooldown. Data showing a contraction in the US economy triggered bond gains on bets the Federal Reserve will cut rates twice this year. Traders also parsed a court ruling that blocked some of Trump’s tariffs.

“We expect further market volatility ahead as headlines on both trade and fiscal policy emerge,” said Ulrike Hoffmann-Burchardi at UBS Global Wealth Management. “We still expect US equities to rise over the next 12 months, but near-term gains this year are likely to be more limited.”

Two of Wall Street’s top investment banks cautioned that the impact of a court ruling striking down many of Trump’s tariff measures may prove limited. Goldman Sachs Group Inc.’s Alec Phillips said “this ruling represents a setback for the administration’s tariff plans and increases uncertainty but might not change the final outcome for most major US trading partners.”

“The tariff levels that we had yesterday are probably going to be the tariff levels that we have tomorrow, because there are so many different authorities the administration can reach into to put it back together,” Michael Zezas, Morgan Stanley’s global head of fixed income and thematic research, told Bloomberg Television.

The S&P 500 rose 0.4%. The Nasdaq 100 added 04%. The Dow Jones Industrial Average wavered.

The yield on 10-year Treasuries four basis points to 4.43%. The Bloomberg Dollar Spot Index lost 0.4%.

• Best Buy Co. reduced its sales and profit outlook as the electronics retailer grapples with tariffs on imports from China, its top source of goods.

• United Airlines Holdings Inc. and JetBlue Airways Corp. agreed to a far-reaching partnership that will allow travelers to use loyalty points and book flights across the two carriers.

• Kohl’s Corp. reported better-than-expected comparable sales, a positive sign amid a tumultuous run of events for the retailer.

• Foot Locker Inc.’s sales slump persisted in the latest quarter, a potential headache for Dick’s Sporting Goods Inc. as it prepares to acquire the struggling sneaker chain.

• Salesforce Inc. raised its annual sales forecast, suggesting that its AI agent product is on a path to contribute significant revenue.

• HP Inc.’s profit outlook fell short of estimates and it cut the annual earnings forecast, pointing toward a weaker economy and continuing costs from US tariffs on goods from China.

• C3.ai Inc. soared as the software company reported fourth-quarter results that beat expectations and announced the renewal of its partnership with Baker Hughes Co.

• Royal Bank of Canada missed estimates after setting aside more money than expected to cover possible loan losses amid a faltering economy even as income rose across most business lines.

• Canadian Imperial Bank of Commerce beat estimates on higher revenue across the business, including at its capital-markets unit, which was boosted by volatile trading conditions.

• LVMH’s deputy chief executive officer said Chinese customers have been pulling back on travel and consumer spending, indicating that a slump in demand for luxury goods may still have some way to run.