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Boeing climbed 1.1 percent, while Caterpillar gained 1.7 percent. The two stocks are seen as bellwethers for trade given their exposure overseas.
Now investors will be looking to China, to see if Beijing and Washington can compromiseon certain trade elements.
Worries about Italy’s budget also capped gains in the broader market.
Luigi Di Maio, the head of the Five Star Movement in Italy, defended the country’s 2.4 percent deficit target for 2019. Di Maio accused European Union officials of deliberately upsetting capital markets through negative comments about the budget. “Some European institutions are playing … at creating terrorism on the markets,” Di Maio said.
“While Italy’s budget plan is below France and less than the 3% threshold that triggers concern, … the worry is the lack of any cushion along with their massive debt pile and little economic growth,” said Peter Boockvar, chief investment officer at Bleakley Advisory Group.
“But maybe the biggest risk is the negative feedback loop that is the Italian banking system that owns many billions of Italian bonds,” Boockvar said.
On top of that, Claudio Borghi, a euroskeptic economist who chairs the budget committee of the lower house of Italy’s parliament, said in a radio interview Tuesday that he was “truly convinced” most of the country’s problems would be solved if it had its own currency.
—CNBC’s Sam Meredith contributed to this report.
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