Wall Street stocks bounced on Tuesday as investors hoped for upcoming trade deals to cool tensions from US President Donald Trump's punishing global tariffs.

The Dow Jones Industrial Average closed 0.5 percent higher at 42,519.64 while the broad-based S&P 500 gained 0.6 percent to 5,970.37.

The tech-heavy Nasdaq Composite Index rallied 0.8 percent to 19,398.96.

In particular, Nvidia shares gained 2.8 percent, helping with the overall advance.

"The fact that we're not down to me suggests that the market expects a trade deal to happen," said Adam Sarhan of 50 Park Investments. "It's a matter of when, not if at this point."

Tuesday's strong gains came despite the Organisation for Economic Co-operation and Development's (OECD) cut to global growth forecasts, warning that Trump's tariffs would stifle the world economy.

After 3.3-percent growth last year, the global economy is now expected to expand by 2.9 percent in 2025 and 2026.

The OECD also expects the US economy to expand by 1.6 percent this year, down from an expected 2.2 percent previously. (AFP)