By Ed Ballard

Markets hit new highs Friday, helped along by the latest twists in the U.S.-China trade saga and budget negotiations in Congress.

The S&P 500 and Nasdaq Composite both hit new records as investors increasingly discounted the economic threat posed by the trade war and Middle East instability.

President Trump said late Thursday a deal had been signed with China. Beijing pledged to approve export applications for rare earths, a major sticking point in trade negotiations.

Both Commerce Secretary Howard Lutnick and Treasury Secretary Scott Bessent said the U.S. was closing in on numerous other trade deals. Washington hopes to wrap up trade talks with more than a dozen nations by the start of September, Bessent said.

In another boost, the Treasury secretary said the "revenge tax" should be removed from Trump's fiscal megabill, after G-7 countries agreed to exempt U.S. companies from an international minimum tax pact. The potential retaliatory tax had roiled markets and frustrated foreign-owned companies, who argued it would depress U.S. investment.

In recent trading:

The major U.S. indexes rose.

The WSJ Dollar Index weakened modestly, holding near its lowest level since 2023.

U.S. bond yields wavered, after settling Thursday around 4.25%.

European and Japanese stocks rose, with the Nikkei 225 closing at its highest level since December. Chinese stocks edged lower after weak industrial data.

Gold prices dropped below $3,300 a troy ounce.

Write to Ed Ballard at ed.ballard@wsj.com

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(END) Dow Jones Newswires

June 27, 2025 09:39 ET (13:39 GMT)

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