After months of agony, it looks like the stock market has finally learned to live with President Donald Trump's impact on trade and tariffs.

The S&P 500 closed at its highest level in almost four months on Tuesday, and is now up close to 1% since Inauguration Day. While April brought a sharp drop, shares have been recovering since.

The important question is what happens next--the index is just 1.7% off its all-time high. Talks between Chinese and U.S. officials ended with a hopeful handshake, but was sparse on details. Separately, an appeals court said tariffs can stay in place for now. Crucially, it won't hear arguments until the end of July, which means that Trump is free to re-implement the levies as originally planned when the 90-day pause ends early next month.

If the talks with China are anything to go by, it looks like trade deficits may no longer be the main issue despite General Motors ramping up domestic investment to help bring them down. For now export controls on semiconductors and rare earths seem to be more important. Nvidia, the chip maker that took a huge hit to sales from restrictions on shipments to China, is near an all-time high as CEO Jensen Huang gives a speech in Paris today.

The market is betting that the peak chaos of the tariffs is behind us. The idea is that if Trump wants to point to stock-market gains as evidence of his success, he won't do anything to radically drag them down.

Despite this, it does look like tariffs will be substantially higher at the end of the year than they were at the start. And on the day when we get the latest inflation data, the impact on the economy still remains to be seen. In any case, the Federal Reserve doesn't look like it will cut interest rates soon.

No one wants to miss out on stock gains. But at this point, investors should probably be more nervous than optimistic.

-- Brian Swint

***

As U.S.-China Trade Talks End, Growth Forecasts Are Slashed

American and Chinese trade delegations wrapped up their meeting in London with an agreed framework to take back to President Donald Trump and Chinese leader Xi Jinping. However, the World Bank released new estimates for economic growth that showed tariffs are expected to shave U.S. growth to only 1.4% this year, about half the rate in 2024.

   -- The World Bank expects a global slowdown, with economic output rising 
      2.3% this year and 2.4% in 2026, down from previous projections of 2.7% 
      each year. Chief economist Indermit Gill said global growth prospects 
      "have deteriorated," and without a change "the harm to living standards 
      could be deep." 
 
   -- The World Bank lowered its forecasts for economic growth in the eurozone, 
      Japan, India, and other countries, as higher tariffs decrease their 
      exports to the U.S. It expects Mexico's growth to be 0.2% this year, 
      below a projection of 1.5% in January. 
 
   -- The World Bank didn't change its China forecast, but expects India's 
      economy will continue growing rapidly although at a slower pace. 
      Developing economies have seen prices for their commodity exports fall 
      sharply under President Donald Trump's tariffs. 
 
   -- Steve Blitz, chief U.S. economist at TS Lombard, noted that air travel is 
      declining from the same time last year, a sign of economic slowdown, and 
      said investors should prepare for slower-than-consensus third-quarter 
      growth, higher inflation, and tighter financial conditions, MarketWatch 
      reported. 

What's Next: World Bank economists warned that if tariffs increase beyond the levels in place in late May, after Trump's April 2 tariffs were paused until July, the U.S. and global economies would slow further. A 10-percentage-point increase in tariffs would slow global growth to 1.8% this year and 2% in 2026.

-- Janet H. Cho

***

Tesla's Driverless Robotaxi Spotted in Austin, Musk Reveals Launch Date

They're here. Videos of a driverless Tesla vehicle moving through an intersection in Austin, Texas, emerged on Tuesday, a sign Elon Musk's electric car maker is rolling out its long-awaited robotaxi. Musk revealed the first public rides were "tentatively" set for June 22, in a reply to a post on X overnight.

   -- Tesla's robotaxis are based on unmodified Tesla vehicles that anyone can 
      buy, Musk said. He also predicted that other auto makers would eventually 
      license Tesla's self-driving technology. "As Tesla robo-taxis become 
      widespread and [auto makers'] solutions don't work, they will naturally 
      turn to us," he said. 
 
   -- Tesla investors have been waiting for good news as the company's 
      challenges continue. Wells Fargo analyst Colin Langan sees another weak 
      quarter of car sales. Through May, North American deliveries were down 
      13% from the same time a year ago, based on data from industry providers 
      Langan tracks. 
 
   -- Wall Street projects second-quarter deliveries of about 412,000 cars, 
      according to FactSet, down 7% from a year ago. Weaker-than-expected 
      deliveries can create profit margin pressure, Langan says. 
 
   -- Tesla also has competition. In addition to Alphabet-owned Waymo 
      driverless cars in the U.S., ride-hailing firm Uber Technologies is 
      working on fully autonomous vehicles. It paired with start-up Wayve 
      Technologies for a trial of the business in London as it looks to bring 
      self-driving technology to Europe. 

What's Next: Robotaxis could replace gig workers, but Tesla is also hiring software engineers for its robots and self-driving operations. The job listing says pay ranges from $132,000 a year to $330,000, with benefits and stock awards. The location is listed as Palo Alto, Calif.

-- Al Root

***

IBM Soars on Plans for a Quantum Supercomputer by 2029

International Business Machines revealed plans to build the world's first large-scale, fault-tolerant quantum supercomputer called Quantum Starling, for rollout sometime around 2029. The news pushed the tech giant's shares above a $250 billion market value for the first time, and to a new closing high of $276.24.

   -- The machine would be capable of performing thousands of times more 
      operations than current quantum computers. IBM has been involved in 
      quantum computing for a while, but an issue and perhaps the biggest 
      hurdle to wide-scale deployment is the incidence of errors. 
 
   -- Qubits, the basic units of information in a quantum machine, are 
      sensitive to environmental disturbances. The key to building larger 
      computers isn't simply adding more qubits, which actually increases the 
      likelihood of faulty calculations. IBM also plans to use a low-density 
      parity check code to improve data transmission. 
 
   -- Jay Gambetta, who is IBM's vice president for Quantum, said they believe 
      they've cracked the code on error correction. That means it's just a 
      matter of time before IBM's vision is realized. It uses an architecture 
      called gate-based quantum computing that also is used by smaller firms 
      such as Rigetti Computing. 
 
   -- IBM first demonstrated a working quantum computer in 2000. Sixteen years 
      later, it released a five-qubit superconducting quantum computer over the 
      cloud, and unveiled the IBM Q System One in 2019. Microsoft and Amazon 
      have also tried to establish a foothold in quantum. 

What's Next: Systems are already under construction at IBM's campus in Poughkeepsie, N.Y. Exact details remain under wraps now. Gambetta said it was one of four areas of focus under IBM Research, which consists of around 3,000 employees.

-- Mackenzie Tatananni

***

Circle's IPO Success Could Bring Wave of Crypto IPOs

Interest in Circle, the stablecoin company that went public last week and soared nearly 170% on its debut day, is expected to spur further deal activity by crypto platforms as investors chase sky-high valuations.

   -- Stephen Richardson, chief strategy officer and head of banking with 
      Fireblocks, a digital asset custody firm, told Barron's that the Trump 
      administration's more friendly tone toward crypto "has opened up 
      significant pent-up demand for digital assets from Wall Street players." 
 
   -- Steve Sosnick, chief strategist at Interactive Brokers, reports that 
      Circle was the fourth-most actively traded stock on its platform in the 
      past week, behind only Tesla, Nvidia, and Palantir. Circle shares are the 
      sixth-largest holding in Cathie Wood's flagship ARK Innovation 
      exchange-traded fund. 
 
   -- Laura Katherine Mann, a partner in the Americas Capital Group for White & 
      Case law firm, expects a wave of crypto IPOs. Gemini, the crypto exchange 
      founded by Cameron and Tyler Winklevoss, recently filed confidentially 
      with the Securities and Exchange Commission for an IPO. 
 
   -- Some are cautious about multiples. Circle has a market valuation of about 
      $25 billion, about 160 times its earnings. John Ma, CEO of crypto 
      investing firm Artemis, said that if Circle's rival Tether went public 
      today, it could be valued at $515 billion, more than Coca-Cola and 
      Costco. 

What's Next: Ma also conceded in his X post that these multiples are "insane and unlikely to hold up." And Tether CEO Paolo Ardoino said in a follow up post on X that Tether has "no need to go public."

-- Paul R. La Monica and Janet H. Cho

***

General Motors to Spend $4 Billion on U.S. Manufacturing

General Motors announced $4 billion in capital projects for its domestic production footprint late Tuesday in a win for American manufacturing at the expense of Mexico and Canada amid President Donald Trump's sweeping automotive tariff policies.

   -- "Today's announcement demonstrates our ongoing commitment to build 
      vehicles in the U.S. and to support American jobs," said GM CEO Mary 
      Barra in a news release. "We're focused on giving customers choice and 
      offering a broad range of vehicles they love." 
 
   -- GM's Orion Assembly Plant in Michigan, Fairfax Assembly Plant in Kansas, 
      and Spring Hill Manufacturing in Tennessee were mentioned by the company. 
      Spring Hill will begin manufacturing the Chevy Blazer in 2027, which is 
      currently assembled in Mexico. It will also make a gasoline-powered Chevy 
      Equinox, which today is assembled in Canada and Mexico. 
 
   -- GM spends about $10 billion on new plants and equipment each year. The $4 
      billion price tag announced Tuesday represents about 20% of that total, 
      assuming the spending is spread over a couple of years. 

What's Next: The cost to assemble cars in the U.S. shouldn't impact affordability all that much, as long as GM can still source low-cost parts tariff-free from trading partners.

-- Al Root

***

Dear Quentin,

I am seeking advice on selecting the executor for my husband's and my estate. We are in our 80s. We have two children, both of whom are honest and responsible. One child has acquired significant knowledge of contracts, legal documents and business procedures through their education and work experience. However, this child will be relocating 1,500 miles away soon.

The second child excels in practical, day-to-day tasks but lacks experience in personal finance and legal matters. Our estate will comprise a home and vehicles, as well as banking and investment assets to be managed. Our attorney strongly recommends that, given the presence of real property, the executor should be a local resident. What are your thoughts on this matter?

-- Mother & Wife

Read the Moneyist's response here.

-- Quentin Fottrell

***

-- Newsletter edited by Liz Moyer, Rupert Steiner, Callum Keown

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

June 11, 2025 07:22 ET (11:22 GMT)

Copyright (c) 2025 Dow Jones & Company, Inc.