Stocks climb for second straight day on U.S.-China trade optimism
Stocks closed broadly higher on Wall Street for the second straight day Thursday as the U.S. and China kicked off a new round of negotiations in their long-running trade war.
Technology companies and banks led the rally as investors turned hopeful that the 13th round of trade talks will bring both sides closer to ending the costly conflict between the world’s two biggest economies.
Traders were encouraged after President Trump said he would meet with Chinese Vice Premier Liu He, who is leading Beijing’s negotiating team, at the White House on Friday. He also said China wants to make a deal.
“It’s really good that Trump is meeting him because that increases the odds that some type of positive news may happen tomorrow,” said Brad Bernstein, senior portfolio manager at UBS Global Wealth Management.
The Standard & Poor’s 500 index rose 18.73 points, or 0.6%, to 2,938.13. The Dow Jones industrial average gained 150.67 points, or 0.6%, to 26,496.67. It had been up as much as 257 points. The Nasdaq added 47.04 points, or 0.6%, to 7,950.78.
The yield on the 10-year Treasury rose to 1.67% from 1.58% late Wednesday, a big move.
Thursday’s rally extended the S&P 500’s gains from the day before, though the index remains on track for its fourth-straight weekly loss.
Markets have been jittery this week as investors assessed the potential for a breakthrough in the trade talks even as tensions escalated between Washington and Beijing. The U.S. blacklisted a group of Chinese technology companies over alleged human rights violations this week. The trade war has dragged on for 15 months, inflicting economic damage on both countries and raising fears of a global recession.
Technology stocks helped lift the market Thursday. The sector is particularly sensitive to any news coming out of trade negotiations because many of the companies rely on China for sales growth and supply chains. Apple gained 1.3%. Chipmakers also rose. Intel added 1.2% and Nvidia picked up 1.3%.
Several big banks notched solid gains, including Bank of America, which climbed 2%. Banks benefited from rising bond yields, which allow banks to charge higher interest rates on loans.
Energy companies got a boost from a 1.8% increase in crude oil prices. Chevron rose 1.3%.
Bed Bath & Beyond surged 21.6% after the struggling home goods chain named Target’s former chief merchandising officer to be its new chief executive and president. Mark Tritton, a 30-year-retail industry veteran, will assume the top role on Nov. 4 and succeed interim CEO Mary A. Winston.
Delta Air Lines fell 1.5% after the company gave investors a weak profit forecast for the fourth quarter. The fourth quarter is among the busiest for U.S. airlines because of holiday travelers.
Benchmark crude oil rose 96 cents to $53.55 a barrel. Brent crude oil, the international standard, gained 78 cents to $59.10 a barrel.
Gold fell $11.30 to $1.494.80 an ounce and silver fell 21 cents to $17.52 an ounce.
The dollar rose to 107.91 Japanese yen from 107.55 yen Wednesday. The euro strengthened to $1.1006 from $1.0974.
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