Equities rally dissipates as trade optimism fades, yield curve flattens

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European shares rise on Trump tariff relief, with Germany's carmakers BMW, Daimler and VW - seen as sensitive to trade tariffs - all gaining

NEW YORK - Wall Street’s indexes ended Tuesday’s session virtually unchanged after investors turned their focus to U.S.-China trade tensions as euphoria from Friday’s U.S.-Mexico deal faded.

A U.S.-Mexico trade and immigration agreement announced late on Friday had prompted a Monday rally that carried over to Tuesday morning in part because it prompted investor hopes that U.S. President Donald Trump might also reach a deal with China. “Trade sentiment is driving everything. When Trump comes out and says he’s holding up the China deal personally that shakes confidence in how things will work out later this month,” said Chris Zaccarelli, Chief Investment Officer at Independent Advisor Alliance in Charlotte, North Carolina, adding that it wasn’t clear if Trump and Xi would even end up meeting.

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