Stocks

US stocks end in green as China extends olive branch

Reuters | Updated on September 12, 2019 Published on September 12, 2019

Indexes up: Dow 0.85%, S&P 500 0.72%, Nasdaq 1.06%

NEW YORK, Sept 11 Wall Street moved higher on Wednesday, led by tariff-sensitive technology and industrial stocks after China extended an olive branch ahead of next month's trade negotiations with the United States.

The S&P 500 closed above the 3,000 mark for the first time since July 30.

Apple Inc provided the biggest boost to the S&P 500 and the Nasdaq the day after it unveiled its latest iPhone upgrade and announced the launch date of its Apple TV+ streaming service.

Its shares rose 3.2 per cent, once more lifting the company's value above the $1 trillion mark.

The blue-chip Dow, led by Boeing Co, posted its sixth consecutive daily gain. Boeing, the largest U.S. exporter by dollar value, gained 3.6 per cent.

China announced tariff exemptions for a basket of U.S. goods, a move viewed by many investors as a show of good faith just weeks ahead of planned talks aimed at resolving the trade war, which has bruised world economies and rattled markets for months.

However, a senior White House adviser urged investors to be patient in an effort to curb expectations for the trade talks scheduled to take place next month in Washington.

“The general market still believes that a real deal is possible and all of these moves by the White House and China are simply negotiating tactics,” said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York. “(But) that belief swings on a daily basis based on tweets and statements from China.

“Right now we're swinging a bit toward the chance of a deal being made in a reasonable time frame,” Ghriskey added.

In a series of morning tweets, President Donald Trump called on the U.S. Federal Reserve to slash interest rates into negative territory, a move typically seen as a last-ditch effort to revive sluggish economies.

“The experiment of negative interest rates has certainly proved to be flawed in both the ECB and Japan and I certainly think it's something the United States should probably try to avoid at all costs,” said Art Hogan, chief market strategist at National Securities in New York.

Markets still expect the Fed to cut interest rates by 25 basis points at the conclusion of its monetary policy meeting next week.

U.S. Treasury yields rose for the third straight session ahead of the European Central Bank's (ECB) meeting on Thursday.

The Dow Jones Industrial Average rose 227.61 points, or 0.85 per cent, to 27,137.04, the S&P 500 gained 21.54 points, or 0.72 per cent, to 3,000.93 and the Nasdaq Composite added 85.52 points, or 1.06 per cent, to 8,169.68.

Of the 11 major sectors in the S&P 500, all but real estate closed in the black.

Published on September 12, 2019
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