US stocks recover amid trade optimism — Bloomberg

According to Bloomberg, easing trade tensions have reduced fears of recession in the United States economy and boosted consumer activity. As a result, the S&P 500 index has recovered all its losses incurred since early April.

At the same time, US bond prices are falling and yields are rising due to risks associated with the country's budget deficit. Bloomberg reports that Congress is discussing a bill to extend President Donald Trump's tax cuts.

In a note to clients, UBS's Aaron Nordvik pointed to an optimistic outlook for consumer staples stocks, provided there is positive news on tariffs and tax reforms.

With US investors now turning their attention from trade tensions to climbing bond yields, UBS and Goldman Sachs are advocating a dual-pronged investment approach. The strategy involves two key moves: purchasing consumer stocks and shorting interest-rate-sensitive sectors such as housing, Bloomberg reports.