Wall Street climbs as tech boost offsets economic worries

US stocks edged higher on Wednesday, as strength in technology shares offset declines driven by weak economic data that deepened concerns about the impact of the Trump administration's erratic trade policies.

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The services sector contracted for the first time in nearly a year in May, while businesses paid higher input prices, a reminder that the economy was still at risk of experiencing a period of very slow growth and high inflation.

The ADP National Employment Report showed US private employers added the fewest number of workers in more than two years in May. Investors are awaiting Friday's nonfarm-payrolls data for more signs on how trade uncertainty is affecting the US labour market.

Washington doubled tariffs on imported steel and aluminium to 50% on Wednesday, the same deadline President Donald Trump had set for trading partners to make their best offers to avoid other punishing import levies from taking effect in early July.

Investor focus is squarely on tariff negotiations between Washington and its trading partners, with Trump and Chinese leader Xi Jinping expected to speak sometime this week as tensions simmer between the world’s two biggest economies.

"If we can’t get to an agreement on China, the tariff battle will be a headline issue for many months to come and will have an impact on both domestic and international economies," said Phil Blancato, CEO of Ladenburg Thalmann Asset Management.