Wall Street bounces as trade temperature cools
By Chuck Mikolajczak NEW YORK (Reuters) - U.S. stocks rose on Monday, following a sharp sell-off in the prior session, after U.S.
By Chuck Mikolajczak
NEW YORK (Reuters) - U.S. stocks rose on Monday, following a sharp sell-off in the prior session, after U.S. President Donald Trump predicted a trade deal with China, cooling investor concerns after a ramp-up in rhetoric derailed markets last week.
Following the G7 summit of world leaders in Biarritz, France, Trump said he believed China was sincere about the desire to reach a deal, citing what he described as increasing economic pressure on Beijing and job losses there.
Shares of tariff-sensitive companies rose in response. Apple Inc's
Chipmakers, which are heavily reliant upon China for revenue, also rose. The Philadelphia Semiconductor index <.SOX> added 0.86% after slumping more than 4% on Friday.
Still, market participants said the rebound paled in comparison to last week's decline, and they expected recent volatility to continue.
"The markets are telling us something very important with this pricing action today. We are seeing some gains across the board for the Nasdaq S&P and Dow, but we are also seeing a very significant downtick in volume," said Peter Kenny, founder of Kenny’s Commentary LLC and Strategic Board Solutions LLC in New York.
"This is not a healthy bounce and it is across virtually all the major indexes. So it is an indication the momentum for U.S. equities remains biased to the downside," Kenny said.
The Dow Jones Industrial Average <.DJI> rose 269.93 points, or 1.05%, to 25,898.83, the S&P 500 <.SPX> gained 31.27 points, or 1.10%, to 2,878.38, and the Nasdaq Composite <.IXIC> added 101.97 points, or 1.32%, to 7,853.74.
Commerce Department data showed new orders for key U.S.-made capital goods rose modestly in July, while shipments fell by the most in nearly three years. The data could provide the Federal Reserve with more fuel to cut interest rates again when policymakers meet next month.
Concerns about the global economy slipping into recession and uncertainty over the pace of U.S. interest rate cuts have created some anxiety about how long the current U.S. expansion will last. The S&P 500 is off more than 5% from the record high hit in late July after suffering its longest run of weekly declines since May.
Even with Monday's broad gains, with each of the major S&P 500 sectors rising, Wall Street's fear gauge, the CBOE Volatility index <.VIX>, hit its highest level in more than a week earlier in the session.
Among other stocks, Celgene Corp
Advancing issues outnumbered declining ones on the NYSE by a 1.66-to-1 ratio; on Nasdaq, a 1.74-to-1 ratio favoured advancers.
The S&P 500 posted four new 52-week highs and 17 new lows; the Nasdaq Composite recorded 17 new highs and 134 new lows.
About 5.71 billion shares changed hands in U.S. exchanges, compared with the 7.57 billion daily average over the last 20 sessions.
(Reporting by Chuck Mikolajczak; Editing by Lisa Shumaker and Leslie Adler)
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By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States
BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.