- Stock indexes closed higher on Monday despite uncertain economic news as Trump’s tariffs continue to be fought over in court.
After posting their strongest month since 2023 in May, stocks started off June on a strong foot. Indexes opened in the red but closed higher Monday, powering through a poor manufacturing report and ongoing uncertainty over U.S. trade negotiations.
The S&P 500 closed 0.3% higher. The Dow gained 0.08% and the Nasdaq gained 0.7%.
Nvidia gained 2.2% and Meta rose 3.6%, helping pull the overall index higher.
According to the Institute for Supply Management’s manufacturing report this morning, the sector contracted for the third month in a row, with new orders, backlogs, production, and employment all shrinking. Respondents to the ISM’s monthly survey overwhelmingly cited uncertainty about tariffs and higher input costs as challenges.
“In May, U.S. manufacturing activity slipped further into contraction after expanding only marginally in February,” Susan Spence, chair of the ISM’s Manufacturing Business Survey Committee, said in a statement. She added that deliveries were delayed because of additional processing time at ports and because “suppliers and panelists’ companies are haggling over who pays for applied tariffs.”
Last week, an appeals court permitted the Trump administration’s tariffs to stay in place while lawsuits on their legality proceed, potentially going all the way up to the Supreme Court. However, even if the current “reciprocal” tariffs are ruled illegal, analysts note, the White House has several legal options to pursue its tariff policies.
“Either way, tariff rates are likely to get back over 10% and stay there, one way or another,” researchers at LPL Financial said in a note.
“Trade negotiations will continue, economic growth and deficit concerns will remain, and markets are likely to continue to be volatile around lingering trade policy uncertainty.”