By STAN CHOE, Associated Press Business Writer

NEW YORK (AP) — U.S. stocks are nearly stuck in place on Monday as the world’s two largest economies begin talks on trade that could help avoid a recession.

The S&P 500 was down 0.1% in early trading. The Dow Jones Industrial Average was down 107 points, or 0.3%, as of 9:35 a.m. Eastern time, and the Nasdaq composite was 0.1% higher.

Officials from the United States and China are meeting in London to talk about a range of different disputes that are separating them. The hope is that they can eventually reach a deal that will lower each’s punishing level of tariffs against the other, which are currently on pause, so that the flow of everything from tiny tech gadgets to enormous machinery can continue.

Hopes that President Donald Trump will lower his tariffs after reaching such trade deals with countries around the world have been among the main reasons the S&P 500 has rallied back so furiously since dropping roughly 20% from its record two months ago. It’s back within 2.5% of its all-time high.

But nothing is assured, and London’s discussion follows a prior round of talks in Switzerland.

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That kept trading relatively quiet on Wall Street, and Treasury yields were also holding steady in the U.S. bond market as the countdown continued.

One of the market’s sharpest moves came from Warner Bros. Discovery, which jumped 11.8% after saying it would split into two companies. One will get Warner Bros. Television, HBO Max and other studio brands, while the other will hold onto CNN, TNT Sports and other entertainment, sports and news television brands around the world, along with some digital products.

IonQ rose 3.2% after the quantum computing and networking company said it agreed to buy Oxford Ionics for nearly $1.08 billion. All but $10 million of the purchase price will come from IonQ’s stock, and the hope is that the combined company will benefit from its complementary parts to produce computers that can perform better than classical machines.

Tesla, meanwhile, returned to falling. The electric vehicle company has been struggling as Elon Musk’s relationship with Trump has fallen apart, and it fell 3.5% Monday.

In stock markets abroad, indexes were modest lower in Europe after rising across much of Asia.

Chinese markets rallied even though the government reported that exports slowed in May, growing 4.8% from a year earlier after jumping more than 8% in April. China also reported that consumer prices fell 0.1% in May from a year earlier, marking the fourth consecutive month of deflation.

Stocks rallied 1.6% in Hong Kong and rose 0.4% in Shanghai.

In the bond market, the yield on the 10-year Treasury edged down to 4.50% from 4.51% late Friday.

AP Writer Jiang Junzhe contributed.

By ILLIA NOVIKOV, Associated Press

KYIV, Ukraine (AP) — Russia launched almost 500 drones at Ukraine in the biggest overnight drone bombardment of the three-year war, the Ukrainian air force said Monday, as the Kremlin presses its summer offensive amid direct peace talks that have yet to deliver progress on stopping the fighting.

As well as 479 drones, 20 missiles of various types were fired at different parts of Ukraine, according to the air force, which said the barrage targeted mainly central and western areas of Ukraine.

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Ukraine’s air force said its air defenses destroyed 277 drones and 19 missiles in mid-flight on Sunday night, claiming that only 10 drones or missiles hit their target. Officials said one person was injured. It was not possible to independently verify the claims.

A recent escalation in aerial attacks has coincided with a renewed Russian battlefield push on eastern and northeastern parts of the roughly 620-mile front line.

Ukraine’s President Volodymyr Zelenskyy said late Sunday that in some of those areas “the situation is very difficult.” He provided no details.

Ukraine is short-handed on the front line against its bigger enemy and needs further military support from its Western partners, especially air defenses. But uncertainty about the U.S. policy on the war has fueled doubts about how much help Kyiv can count on.

Ukraine has produced some stunning counter-punches, however. Its recent drone attack on distant Russian air bases was unprecedented in its scope and sophistication.

Russia intensifies its attacks

The Ukrainian General Staff claimed Monday that special operations forces struck two Russian fighter jets stationed at the Savasleyka airfield in Russia’s Nizhny Novgorod region located some 650 kilometers northeast from the Ukrainian border. The statement did not say how the planes were hit. There was no immediate comment on the claim from the Russian authorities. Some Russian war bloggers said there was no damage to the warplanes.

Russian officials have said the recent intensified assaults are part of a series of retaliations for Ukraine’s strike on air bases that were hosting nuclear-capable strategic bombers. A strike on a Ukrainian air base in Dubno, in the western Rivne region, was one such response, the Russian Defense Ministry said Monday.

Two recent rounds of direct peace talks between Russian and Ukrainian delegations in Istanbul have yielded no significant breakthroughs beyond pledges to swap prisoners as well as thousands of their dead and seriously wounded troops. Russian President Vladimir Putin has indicated he will keep fighting until his conditions are met.

Russia and Ukraine exchange more prisoners of war

The exchange of hundreds of soldiers and civilians has been a small sign of cooperation in otherwise failed efforts to agree on a ceasefire.

More prisoners were swapped Monday in a staggered process taking place over coming days, Zelenskyy and the Russian Defense Ministry announced, though neither side said how many. Those swapped included wounded and seriously wounded soldiers, as well as those under 25, Zelenskyy said. “The process is quite complicated, there are many sensitive details, negotiations continue virtually every day,” he added.

But the two sides have disagreed over the transfer of soldiers killed in action. The Russian Defense Ministry alleged that Ukraine over the weekend failed to pick up the bodies of its fallen soldiers that Russia made available for collection.

But Zelenskyy claimed that Moscow hadn’t sent to Kyiv the names of more than 1,000 Ukrainians whose bodies are currently in Russian-controlled territories, as had been agreed. He accused Russian authorities of playing “dirty” games.

Even so, Kremlin spokesman Dmitry Peskov said Monday the swap is expected to go ahead, although he said there were no specific arrangements so far for the transfer.

Ukraine’s intelligence chief, Kyrylo Budanov, said the exchange of soldiers’ bodies will begin this week.

Long-range drone attacks continue

Russia has repeatedly targeted civilian areas of Ukraine with Shahed drones during the war, as happened on Sunday night. The attacks have killed more that 12,000 Ukrainian civilians, according to the United Nations. Russia says it only attacks military targets.

Ukraine has developed long-range drones that continue to strike deep inside Russia.

Russia’s Ministry of Defense said Monday that it shot down 49 Ukrainian drones overnight over seven Russian regions.

Two drones hit a plant specializing in electronic warfare equipment in the Chuvashia region, located more than 370 miles east of Moscow, local officials reported.

Alexander Gusev, head of Russia’s Voronezh region, said that 25 drones had been shot down there overnight, damaging a gas pipeline and sparking a small fire.

By MICHELLE CHAPMAN, Associated Press Business Writer

NEW YORK (AP) — Warner Bros. Discovery will split into two public companies by next year, calving off cable operations from its streaming service as the number of people “cutting the cord” brings with it a sustained upheaval in the entertainment industry.

Warner Bros. Discovery said Monday that Streaming & Studios will include Warner Bros. Television, Warner Bros. Motion Picture Group, DC Studios, HBO, and HBO Max, as well as their film and television libraries.

The Global Networks company will include CNN, TNT Sports in the U.S., and Discovery, top free-to-air channels across Europe, and digital products such as the Discovery+ streaming service and Bleacher Report.

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Shares jumped more than 7% before the market opened.

Warner Bros. Discovery CEO David Zaslav will serve as CEO of Streaming & Studios. Gunnar Wiedenfels, chief financial officer of Warner Bros. Discovery, will serve as CEO of Global Networks. Both will continue in their current roles until the separation.

Just days ago Warner Bros. Discovery shareholders voted to reject the 2024 pay packages of some executives, including Zaslav’s pay package of more than $51 million. The vote is symbolic, as it is nonbinding.

“By operating as two distinct and optimized companies in the future, we are empowering these iconic brands with the sharper focus and strategic flexibility they need to compete most effectively in today’s evolving media landscape,” Zaslav said in a statement.

Warner Bros. Discovery said in December that it was implementing a restructuring plan that would have Warner Bros. Discovery serve as the parent company for two operating divisions, Global Linear Networks and Streaming & Studios. The announcement was taken as a preview of the separation of divisions that was announced Monday.

The cable industry has been under assault for years from streaming services like Disney, Netflix, Amazon and HBO Max, as well as internet plans offered by mobile phone companies. Comcast, which is of nearly equal size to Charter, spun off many of its cable television networks in November as as consumers increasingly swap out their cable TV subscriptions for streaming platforms.

Last month Charter Communications offered to acquire Cox Communications, a $34.5 billion merger that would combine two of the top three cable companies in the U.S.

So-called “cord cutting” has cost the industry millions of customers and left them searching for ways to successfully compete.

The Warner Bros. Discovery split is expected to be completed by the middle of next year. It still needs final approval from the Warner Bros. Discovery board.

WASHINGTON (AP) — President Donald Trump’s new ban on travel to the U.S. by citizens from 12 mainly African and Middle Eastern countries took effect Monday amid rising tension over the president’s escalating campaign of immigration enforcement.

The new proclamation, which Trump signed last week, applies to citizens of Afghanistan, Myanmar, Chad, the Republic of Congo, Equatorial Guinea, Eritrea, Haiti, Iran, Libya, Somalia, Sudan and Yemen. It also imposes heightened restrictions on people from Burundi, Cuba, Laos, Sierra Leone, Togo, Turkmenistan and Venezuela who are outside the U.S. and don’t hold a valid visa.

The new ban does not revoke visas previously issued to people from countries on the list, according to guidance issued Friday to all U.S. diplomatic missions. However, unless an applicant meets narrow criteria for an exemption to the ban, his or her application will be rejected starting Monday. Travelers with previously issued visas should still be able to enter the U.S. even after the ban takes effect.

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During Trump’s first term, a hastily written executive order ordering the denial of entry to citizens of mainly Muslim countries created chaos at numerous airports and other ports of entry, prompting successful legal challenges and major revisions to the policy.

No such disruption was immediately discernible at Los Angeles International Airport in the hours after the new ban took effect.

Haitian-American Elvanise Louis-Juste, who was at the airport earlier Sunday in Newark, New Jersey, awaiting a flight to her home state of Florida, said many Haitians wanting to come to the U.S. are simply seeking to escape violence and unrest.

“I have family in Haiti, so it’s pretty upsetting to see and hear,” Louis-Juste, 23, said of the travel ban. “I don’t think it’s a good thing. I think it’s very upsetting.”

Many immigration experts say the new ban is more carefully crafted and appears designed to beat court challenges that hampered the first by focusing on the visa application process.

Trump said this time that some countries had “deficient” screening for passports and other public documents or have historically refused to take back their own citizens. He relied extensively on an annual Homeland Security report of people who remain in the U.S. after their visas expired.

Measuring overstay rates has challenged experts for decades, but the government has made a limited attempt annually since 2016. Trump’s proclamation cites overstay rates for eight of the 12 banned countries.

Trump also tied the new ban to a terrorist attack in Boulder, Colorado, saying it underscored the dangers posed by some visitors who overstay visas. U.S. officials say the man charged in the attack overstayed a tourist visa. He is from Egypt, a country that is not on Trump’s restricted list.

The ban was quickly denounced by groups that provide aid and resettlement help to refugees.

“This policy is not about national security — it is about sowing division and vilifying communities that are seeking safety and opportunity in the United States,” said Abby Maxman, president of Oxfam America, a nonprofit international relief organization.

The inclusion of Afghanistan angered some supporters who have worked to resettle its people. The ban does make exceptions for Afghans on Special Immigrant Visas, generally people who worked most closely with the U.S. government during the two-decade-long war there.

Afghanistan had been one of the largest sources of resettled refugees, with about 14,000 arrivals in a 12-month period through September 2024. Trump suspended refugee resettlement his first day in office.