Wall Street climbs as trade optimism boosts tech, industrials

By Shreyashi Sanyal (Reuters) - Shares of technology and industrial companies pushed Wall Street's main indexes to session highs on Monday, after President Donald Trump said he would delay a planned hike in tariffs on Chinese imports. The announcement is the clearest sign yet that the two countries are closing in on a deal to end their prolonged trade spat that has slowed global growth and disrupted markets. Trump said he was optimistic that a final trade deal could be reached with China and that he would hold a summit to sign any pact, but cautioned an agreement may still not happen

Reuters February 26, 2019 00:05:33 IST
Wall Street climbs as trade optimism boosts tech, industrials

Wall Street climbs as trade optimism boosts tech industrials

By Shreyashi Sanyal

(Reuters) - Shares of technology and industrial companies pushed Wall Street's main indexes to session highs on Monday, after President Donald Trump said he would delay a planned hike in tariffs on Chinese imports.

The announcement is the clearest sign yet that the two countries are closing in on a deal to end their prolonged trade spat that has slowed global growth and disrupted markets.

Trump said he was optimistic that a final trade deal could be reached with China and that he would hold a summit to sign any pact, but cautioned an agreement may still not happen.

"The focus is obviously on trade today, with the seeming resolution to the trade war which is causing the positivity," said Jamie Cox, managing partner for Harris Financial Group in Richmond, Virginia.

"There is going to be some sort of deal because the economy is softening and tariffs are partly to blame for it."

The S&P technology index rose 1.12 percent, with Apple Inc's 1.5 percent rise leading the rally.

Gains in chip companies, which have a big exposure to the Chinese market, helped the Philadelphia semiconductor index jump 1.75 percent.

The industrial sector climbed 0.95 percent, helped by a more than 1 percent rise in shares of tariff-exposed companies Caterpillar Inc and Boeing Co.

But the sector got the biggest boost from General Electric Co, which jumped 9.4 percent after announcing a sale of its biopharma business to Danaher Corp for $21.4 billion. Danaher shares were up 8 percent.

Optimism on the trade front and dovish signals from the Federal Reserve have bolstered U.S. stocks in recent weeks, with the S&P 500 index about 4 percent away from its record closing high hit in late September.

The benchmark index is now trading at its highest level since November 8.

At 11:07 a.m. ET the Dow Jones Industrial Average was up 206.48 points, or 0.79 percent, at 26,238.29, the S&P 500 was up 20.58 points, or 0.74 percent, at 2,813.25 and the Nasdaq Composite was up 73.62 points, or 0.98 percent, at 7,601.17.

The financial sector rose 1.35 percent, helped by a 1.50 percent rise in bank stocks, ahead of Fed Chair Jerome Powell speech about monetary policy on Tuesday and Wednesday.

Adding to optimism was a flurry of M&A activity.

Spark Therapeutics shares more than doubled after Swiss drugmaker Roche Holding AG agreed to buy the company for $4.3 billion.

Canadian miner Barrick Gold Corp offered to buy U.S. rival Newmont Mining Corp for nearly $18 billion. However, Newmont's shares dipped 0.7 percent as the offer price was at a discount.

Advancing issues outnumbered decliners by a 2.15-to-1 ratio on the NYSE and by a 1.99-to-1 ratio on the Nasdaq.

The S&P index recorded 58 new 52-week highs and one new low, while the Nasdaq recorded 109 new highs and four new lows.

(Reporting by Shreyashi Sanyal and Amy Caren Daniel in Bengaluru; Editing by Anil D'Silva)

This story has not been edited by Firstpost staff and is generated by auto-feed.

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