U.S. Stocks Add A Bit More To Their All-Time High

US stocks are adding to their record highs on Monday as Wall Street nears the end of a second straight winning month.

The US stock market being back at a record high could raise the risk of renewed tariff escalations.

The S&P 500 was 0.3% higher in its first trading session after completing a stunning rebound from its springtime sell-off of roughly 20%.

The Dow Jones Industrial Average was up 218 points, or 0.5%, as of 11:40 a.m. Eastern Time, and the Nasdaq Composite was 0.3% higher, Stan Choe and Elaine Kurtenbach reported for the Associated Press (AP).

Stocks got a boost after Canada said it was rescinding a planned tax on US technology firms and resuming trade talks with the US.

On Friday, US President Donald Trump said he was suspending talks with Canada because of his anger over the tax, which he called “a direct and blatant attack on our country.”

One of the main reasons US stocks rebounded so quickly from their springtime swoon has been hope that Trump will reach deals with other countries to lower his proposed tariffs.

Otherwise, the fear is that trade wars could stifle the economy and drive inflation higher.

Many of Trump’s announced tariffs are currently on pause, and they’re scheduled to take effect in just over a week. In an interview with Fox News Channel’s Sunday Morning Futures, Trump said his administration will notify countries that the trade penalties will take effect unless deals are reached with the US.

Letters will start going out “pretty soon” before the approaching deadline, he said.

The US stock market being back at a record high could raise the risk of renewed tariff escalations, according to strategists at Deutsche Bank led by Parag Thatte and Binky Chadha.

They point to the pattern in 2018 and 2019 of market rallies prompting tariff escalations, which then caused market pullbacks — followed by relents on tariffs that sparked rallies again.