August 29, 2019 / 12:07 PM / 3 months ago

Wall Street rallies after China trade comments

NEW YORK (Reuters) - U.S. stocks rallied more than 1% on Thursday, buoyed by gains in the trade-sensitive technology and industrial sectors as China expressed hope on trade negotiations with the United States, easing concerns that rising tensions could stoke a recession.

China’s commerce ministry said both sides are discussing the next round of talks scheduled for September, but progress would be determined by whether Washington could create favorable conditions.

U.S. President Donald Trump said in a Fox News radio interview that trade talks were scheduled for Thursday “at a different level,” but did not provide details.

Some analysts cautioned that the comments from China were light on substance, and pointed to month-end rebalancing on Friday as supportive of stock gains.

“It sounds to me like more of a continued slow-walking,” said Thomas Martin, senior portfolio manager at Globalt Investments in Atlanta. “But clearly it is time to not ratchet things up further.”

Heavyweight tech stocks with tariff exposure, such as Apple Inc (AAPL.O), up 1.69%, and Microsoft (MSFT.O), up 1.89%, boosted the technology sector by 1.73% for its best day since Aug. 16.

Chipmakers, which draw a large part of their revenue from China, also gained, sending the Philadelphia semiconductor index .SOX up 2.25%.

Industrial names that have also been highly correlated to trade progress, such as United Technologies (UTX.N), advanced, with the sector up 1.77%.

The Dow Jones Industrial Average .DJI rose 326.15 points, or 1.25%, to 26,362.25, the S&P 500 .SPX gained 36.63 points, or 1.27%, to 2,924.57 and the Nasdaq Composite .IXIC added 116.51 points, or 1.48%, to 7,973.39.

Still, the three main indexes were on course to log their worst monthly performance and first monthly decline since a selloff in May, on worries the intensified trade battle between the world’s two largest economies will lead to a global recession.

The Trump administration on Wednesday made official its additional 5% tariff on $300 billion in Chinese imports and set collection dates of Sept. 1 and Dec. 15, prompting several hundreds of U.S. companies to warn of price hikes.

A number of companies, including electronics retailer Best Buy Co Inc (BBY.N) and teen apparel retailer Abercrombie & Fitch Co (ANF.N), reported results earlier on Thursday and warned of the impact from tariffs.

Shares of Best Buy slid 7.99%, making it one of the worst performing issues on the S&P 500, while those of Abercrombie tumbled 15.10%.

Dollar General Corp (DG.N) was the best performer among S&P 500 .SPX companies, rising 10.68% on an upbeat full-year profit forecast. The S&P retail index .SPXRT climbed 1.67%.

FILE PHOTO: A trader works on the floor of the New York Stock Exchange shortly after the closing bell in New York, U.S., August 23, 2019. REUTERS/Lucas Jackson

Advancing issues outnumbered declining ones on the NYSE by a 3.23-to-1 ratio; on Nasdaq, a 2.69-to-1 ratio favored advancers.

The S&P 500 posted 27 new 52-week highs and no new lows; the Nasdaq Composite recorded 40 new highs and 59 new lows.

About 6.01 billion shares changed hands on U.S. exchanges, compared with the 7.23 billion daily average over the last 20 sessions.

Reporting by Chuck Mikolajczak; Editing by Leslie Adler

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below