(Reuters) – U.S. stocks rose by about 1% for the second straight day on Thursday on hopes that top-level U.S.-China trade talks would yield at least a partial deal, while a rise in Apple’s shares lifted the technology sector.
FILE PHOTO: Traders work on the floor at the New York Stock Exchange (NYSE) in New York, U.S., October 9, 2019. REUTERS/Brendan McDermid
Wall Street’s main indexes moved higher after President Donald Trump tweeted he would meet Chinese Vice Premier Liu He on Friday for further trade talks.
“The tweet … is giving market participants a reason to believe that perhaps a trade deal or at least a partial deal might be announced as early as tomorrow,” said Robert Pavlik, chief investment strategist at SlateStone Wealth LLC in New York.
Separately, Liu said Beijing was willing to reach an agreement with Washington to prevent any further escalation in the trade war, Chinese state news agency Xinhua reported.
A senior U.S. Chamber of Commerce official said U.S. and Chinese negotiators were working towards an “early harvest” of confidence-building agreements, including one to avoid currency manipulation.
“Some sort of agreement towards currency is fine, but it would not get us anywhere near from where we started this issue,” Pavlik said.
The latest comments fueled optimism that had been dulled earlier after China urged the United States to stop unreasonable pressure on Chinese companies, while the South China Morning Post reported that the two sides made no progress in deputy-level trade talks earlier in the week.
Equity markets have been rankled by weak economic indicators showing a sharp contraction in U.S. manufacturing and a bleak reading on business activity, bolstering bets of another interest rate cut by the Federal Reserve to combat a slowdown.
Fresh data on Thursday showed U.S. consumer prices were unchanged in September, while underlying inflation retreated.
Apple Inc (AAPL.O) rose 1.4%, lifting the technology sector .SPLCRT by 1%, after Longbow Research upgraded the company’s stock to “buy”, citing higher iPhone 11 demand.
Apple suppliers Skyworks Solutions Inc (SWKS.O) and Qorvo Inc (QRVO.O) gained 5% and 4.6%, respectively, after Cowen and Co upgraded its rating on both the companies, expecting them to benefit from higher iPhone demand.
At 11:31 a.m. ET the Dow Jones Industrial Average .DJI was up 224.93 points, or 0.85%, at 26,570.94, while the S&P 500 .SPX was up 26.44 points, or 0.91%, at 2,945.84. The Nasdaq Composite .IXIC was up 71.85 points, or 0.91%, at 7,975.59.
Among other stocks, Delta Air Lines Inc (DAL.N) fell 3.5%, the most on the S&P 500, after the carrier forecast disappointing current-quarter profit.
Cisco Systems Inc (CSCO.O) dropped 2%, after a report that Goldman Sachs downgraded the network gear maker’s shares to “neutral”.
Advancing issues outnumbered decliners for a 2.20-to-1 ratio on the NYSE and a 1.96-to-1 ratio on the Nasdaq.
The S&P index recorded four new 52-week highs and two new lows, while the Nasdaq recorded 10 new highs and 71 new lows.
Reporting by Shreyashi Sanyal and Medha Singh in Bengaluru; Editing by Shounak Dasgupta