S&P 500 closes higher Tuesday, wiping out 2025 loss, as Nvidia surges

The S&P 500 rose Tuesday, clawing back into positive territory for the year, as investors extended the sharp gains seen in the previous session due to easing U.S.-China trade tensions.

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The broad market index gained 0.72% to close at 5,886.55, while the Nasdaq Composite climbed 1.61% to end at 19,010.09. The Dow Jones Industrial Average lagged, losing 269.67 points, or 0.64%, as a nearly 18% drop in shares of UnitedHealth pressured the benchmark.

Shares of Nvidia advanced 5.6% on news that the company would send 18,000 of its top artificial intelligence chips to Saudi Arabia. Peer chip stocks rose alongside the AI darling, with Broadcom rising nearly 5% and AMD adding 4%.

Tuesday’s gain put the S&P 500 up about 0.1% for 2025. At one point, the index was down more than 17% for the year, as trade tensions dented investor confidence in equities.

However, Wall Street got a reprieve after the U.S. and China agreed to a 90-day tariff pause earlier this week. The news sent stocks surging on Monday, with the Dow soaring more than 1,000 points.

“Couple [the trade news] with a massive chips deal in Saudi Arabia, ticks down in inflation which will pull rates cuts closer, and substantive details of [tax cuts] — you get a full risk-on market,” said Jamie Cox, managing partner at Harris Financial Group. The White House on Tuesday announced a $600 billion investment in the U.S.

Softer inflation

Adding to Tuesday’s gains was softer-than-expected inflation data released earlier in the day.

The consumer price index, a broad measure of goods and services costs across the U.S. economy, increased 2.3% year over year in April. Economists polled by Dow Jones expected inflation to remain at a 2.4% rate last month on a year-over-year basis.

“And just like that, the markets’ twin fears — a tariff-induced recession and sticky inflation — have been greatly assuaged,” said Chris Zaccarelli, chief investment officer at Northlight Asset Management. “We’re still concerned that high valuations and market concentration remain risks to much higher stock prices this year, but in the short run, markets should love this data and continue yesterday’s (China-trade) celebration.”