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US: Stocks join global rally on China trade detente
[NEW YORK] Wall Street stocks finished solidly higher Monday, joining a global rally after the US and China struck a ceasefire on their trade war over the weekend.
The Dow Jones Industrial Average rose 1.1 per cent to close at 25,826.43, increasing nearly 300 points, but about 160 points below its session peak.
The broad-based S&P 500 also gained 1.1 per cent to end at 2,790.37, while the tech-rich Nasdaq Composite Index advanced 1.5 per cent to 7,441.51.
The US and China agreed to not enact new tariff measures while the governments work to hash out new terms of trade, including on such thorny matters as intellectual property protection.
Treasury Secretary Steven Mnuchin said the US will need to need to see "something concrete" from China on trade in the next 90 days to build a real agreement.
But analysts warned about getting too optimistic.
"There is a lot between where we are now and getting an agreement," said Maris Ogg of Tower Bridge Advisors. "The more you look at details, the more you realize that."
Even so, the agreement was still "a little bit better than what people expected."
"The problem is that China needs to look strong in front of their people and the USA needs that too," she added. "I don't think anything can be solved in three months."
Technology shares were generally strong, with Apple reassuming the top spot in market capitalization after rising 3.5 per cent. However, Microsoft and Amazon are both within striking distance of Apple.
Microsoft gained 1.1 per cent and Amazon 4.9 per cent, and both held the top spot earlier in the session.
Petroleum-linked giants ExxonMobil and Halliburton jumped 2.2 per cent and 4.0 per cent, respectively, after Canadian province Alberta ordered a production cut due to excess supplies in the region. That boosted oil prices, which also were helped by expectations that Opec will strike a deal this week to limit output.
Tribune Media surged 11.8 per cent after agreeing to be acquired by Nexstar Media Group for US$4.1 billion in a deal that would create the largest operator of local US television stations. Nexstar gained 6.9 per cent.