Bengaluru: US stocks rose 1% on Wednesday, boosted by technology stocks, as a report about China planning to increase access for foreign firms added to optimism fuelled by President Donald Trump’s upbeat comments on trade.
Beijing is working to replace its Made in China 2025 policy with one that plays down its bid to dominate manufacturing, according to the Wall Street Journal.
Sentiment was already higher after Trump said negotiations with Beijing were taking place by phone and he would not hike tariffs on Chinese imports until he was sure about a deal.
In the interview with Reuters, Trump also said he would intervene in the Justice Department’s case against a top executive at China’s Huawei Technologies if it would help secure a trade deal.
The gains come a day after another volatile session ended with Wall Street finishing slightly lower following Trump’s threat to shut down the US government and political uncertainty in Britain.
“There maybe some near-term optimism because of the trade headlines but we’ll see where it goes," said Scott Brown, chief economist at Raymond James in St. Petersburg, Florida.
“We have seen a lot of intraday movement lately and we might see the same today and that’s a sign the market is looking at what the appropriate level should be."
Trade-sensitive Caterpillar Inc jumped 2.49% and Boeing Co advanced 1.48%, while the Philadelphia SE semiconductor index rose 1.44%.
The technology sector, among the most beaten-down S&P sectors quarter-to-date, rose 1.30%, providing the biggest boost to the market.
The energy sector’s 1.60% rise, helped by a jump in oil prices, led all the 11 major S&P sectors higher with the defensive consumer staples, utilities and real estate posting the smallest gains.
At 9:57 am ET, the Dow Jones Industrial Average was up 256.13 points, or 1.05%, at 24,626.37. The S&P 500 was up 28.62 points, or 1.09%, at 2,665.40 and the Nasdaq Composite was up 95.91 points, or 1.36%, at 7,127.74.
In the seven sessions in December, the three indexes have shed more than 4% in volatile trading, weighed down by fears over global growth, US-China relations, interest rates and growing complications over Britain’s planned divorce from the European Union.
British Prime Minister Theresa May faces a no-confidence vote later in the day, triggered by Conservative lawmakers, with the result expected at 2100 GMT (4 p.m. ET).
The only Dow component in the red was Verizon Communications Inc, down 2.30 percent after Morgan Stanley downgraded the wireless carrier’s shares, expecting limited 5G revenues and increased competition.
Advancing issues outnumbered decliners by a 5.17-to-1 ratio on the NYSE and a 3.41-to-1 ratio on the Nasdaq.
The S&P index recorded 14 new 52-week highs and five new lows, while the Nasdaq recorded nine new highs and 46 new lows.