(MENAFN) The New York Stock Exchange closed midweek largely higher, driven by stronger-than-expected corporate earnings that overshadowed ongoing concerns about the U.S. government shutdown and persistent U.S.-China trade tensions.

The Nasdaq surged 0.66%, gaining 148.38 points to finish at 22,670.08, while the S&P 500 increased 0.4%, or 26.75 points, to close at 6,671.06. Conversely, the Dow Jones slipped slightly by 0.04%, down 17.15 points to 46,253.31.

Despite lingering fears of escalating trade conflicts between Washington and Beijing, the mixed stock market performance reflected investor confidence in solid company financials.

On the trade front, the Treasury Secretary issued a stark warning Wednesday, stating that China "can't be trusted.” He also referenced a recent tariff agreement extended for 90 days, suggesting the possibility of a further extension if China delays its planned export restrictions on rare earth elements.

Addressing concerns over the falling stock market's impact on trade talks, Scott Bessent told media, “We won’t negotiate because the stock market is going down” or shy away from taking strong measures against Beijing for that reason.”

Bessent also highlighted the economic damage of the ongoing federal shutdown, now entering its 15th day, estimating losses of up to $15 billion daily.

Market volatility surged in recent days after China expanded rare earth export restrictions last Thursday, prompting U.S. President Donald Trump to threaten 100% tariffs on Chinese goods. However, Trump later downplayed these threats, assuring, "Don’t worry about China, it will all be fine!" Still, he described China’s refusal to purchase U.S. soybeans as "an economically hostile act" on Tuesday.

In related monetary policy news, Federal Reserve Board member Stephen Miran noted the urgent need to shift toward a more neutral stance given changes in employment and inflation risks, forecasting that two additional interest rate cuts this year are likely.

On the corporate earnings front, U.S. banking giants Bank of America and Morgan Stanley posted stronger-than-expected third-quarter profits, with Bank of America shares climbing 4.4% and Morgan Stanley shares jumping 4.7%.

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