US: Stocks gain on easing China trade war angst

[NEW YORK] Wall Street stocks broke out of a two-day slumber and won solid gains Wednesday after China reversed tariffs on some US goods which boosted hopes for a resolution to the trade war.

The conciliatory move, coupled with another rise in US Treasury bond yields, helped lift stocks after two lacklustre sessions.

"Equities have the best of both worlds," said Karl Haeling of LBBW, citing expectations of central bank easing even as the economy is "okayish".

The Dow Jones Industrial Average jumped 0.9 per cent to finish the day at 27,137.04.

The broad-based S&P 500 advanced 0.7 per cent to close at 3,000.91, while the tech-rich Nasdaq Composite Index surged 1.1 per cent to 8,169.68.

China released two lists of exempted US goods, saving some seafood and anti-cancer drugs from the tariff hit. US President Donald Trump welcomed the development as a "big move".

However, Beijing did not spare high-profile US products like soybeans and pork.

Top negotiators expect to reconvene in Washington early next month after an acrimonious summer in which trade relations deteriorated sharply and both governments announced waves of new tariffs in a stand-off that is dragging on the global economy.

Among individual companies, Boeing rocketed 3.5 per cent higher after chief executive Dennis Muilenburg confirmed the company was still on track to receive approval early in the fourth quarter to resume flights on the 737 MAX, which has been grounded since March after two deadly crashes.

Apple advanced 3.2 per cent as investors cheered a spate of new product and service launches, including new streaming and gaming services.

Oil services company Baker Hughes plunged 7.6 per cent after General Electric announced plans to sell 120.8 million shares of the company. GE gained 2.2 per cent.

Key economic reports in the coming days include data on US consumer prices and retail sales, as well as a policy decision by the European Central Bank, which is expected to undertake more stimulus.

AFP