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US: Stocks rally as trade war fears recede; Dow +2.8%
[NEW YORK] Wall Street stocks surged on Monday amid bargain-hunting and hopes that the United States and China could negotiate new terms of trade and avoid a trade war.
The Dow Jones Industrial Average finished up 2.8 per cent at 24,202.60.
The broad-based S&P 500 rose 2.7 per cent to 2,658.55, while the tech-rich Nasdaq Composite Index jumped 3.3 per cent to 7,220.54.
US stocks tumbled on both Thursday and Friday last week after President Donald Trump unveiled tariffs on up to US$60 billion of Chinese imports and vowed to counter China's alleged "theft" of American intellectual property.
But analysts were heartened by a Wall Street Journal report that said the two countries were actually in talks and that the US had provided specific demands for China that could help resolve the conflict.
Investors are trying to deduce how much of Mr Trump's rhetoric is realistic and how much is a "bargaining tactic," said Tom Cahill, portfolio strategist at Ventura Wealth Management.
"Negotiations behind the scenes are positive for the market," he added.
Technology shares were strong, with Apple advancing 4.8 per cent, Intel 6.3 per cent, Netflix and Adobe Systems both 6.5 per cent.
Microsoft led the Dow with a 7.6 per cent gain after Morgan Stanley lifted its price target on the company, citing the promise of its public cloud offerings.
Facebook's gains were a comparatively tepid 0.4 per cent after the Federal Trade Commission confirmed news reports from last week that it had opened an inquiry over the harvesting of Facebook data on tens of millions of the social network's users by the British consulting group Cambridge Analytica.
Export-oriented companies enjoyed a good day, with Caterpillar winning 3.4 per cent, and Boeing and General Motors both up about 2.5 per cent. All were under pressure last week on fears of a trade clash with China.