Major US banks are having an excellent quarter, easing trade fears

China has used its dominance in the rare earths industry to drive down prices and drive out foreign competitors, U.S. Treasury Secretary Scott Bessent told CNBC in an exclusive interview on Wednesday. He characterized the country as having 'a non-market economy'.

In response, the Trump administration will “exercise industrial policy” to set price floors across a range of sectors. Price floors set a limit on how low suppliers can charge for goods or services. They are generally above market interest rates and are essentially a form of government price control.

In the meantime, Bank of America And Morgan Stanley reported blockbuster second-quarter profits that far exceeded analyst expectations. They joined other major US banks, such as JPMorgan Chase and Goldman Sachs, in having a stellar quarter fueled by robust dealmaking and share price highs.

And despite US President Donald Trump's continued saber-rattling against China on the trade front, traders don't seem ready to let go of stocks just yet. On Wednesday in the United States the S&P500 And Nasdaq Composite alley, and the Russell 2000 reached a new record. After all, according to the US Federal Reserve's Beige Book, earnings reports indicate that the economy is not yet faltering, despite companies already experiencing higher costs due to tariffs.

Whether traders will continue to push stocks to new highs amid fractious trade relations with China will depend in part on earnings from big tech companies like Tesla and Intel expected next week.