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Hopes of trade deal push Wall Street higher
U.S. stocks rose on Monday, boosted by technology and industrial companies, after President Donald Trump said he would delay a planned hike in tariffs on Chinese imports and that he was "very, very close" on a trade deal.
Trump said on Monday he was optimistic that a final trade deal could be reached with China and that he would hold a summit to sign any pact, but cautioned an agreement may still not happen.
The U.S. president`s move to push the deadline is the clearest sign yet that the two countries are closing in on a deal to end their prolonged trade spat, which has slowed global growth and disrupted markets.
"Extension of the deadline shows that everyone wants to work towards the same goal of reaching a settlement that will help both economies grow," said J.J. Kinahan, chief market strategist at TD Ameritrade in Chicago.
"Markets are taking that as a very positive sign that fears of a slowdown due to tariffs could hopefully be mitigated."
The S&P technology index rose 0.69 percent, with Apple Inc`s 1.1 percent rise leading the gains.
Rise in chip companies, which have a big exposure to the Chinese market, helped the Philadelphia semiconductor index climb 1.20 percent.
The tariff-sensitive industrials sector was 0.82 percent higher, helped by Caterpillar Inc`s 2.3 percent jump and Boeing Co 0.7 percent rise.
But the sector got the biggest boost from General Electric Co, which leaped 8.8 percent after announcing a sale of its biopharma business to Danaher Corp for $21.4 billion. Danaher shares were up 7.9 percent.
Optimism on the trade front and dovish signals from the Federal Reserve have bolstered U.S. stocks in recent weeks, with the S&P 500 index is 4.5 percent away from its record closing high hit in late September.
The benchmark index is now trading at its highest level since November 8.
At 12:37 p.m. ET the Dow Jones Industrial Average was up 153.92 points, or 0.59 percent, at 26,185.73. The S&P 500 was up 12.67 points, or 0.45 percent, at 2,805.34 and the Nasdaq Composite was up 43.40 points, or 0.58 percent, at 7,570.95.
The financial sector rose 1.31 percent, helped by a 1.61 percent rise in bank stocks, ahead of Fed Chair Jerome Powell`s testimony on monetary policy on Tuesday and Wednesday.
Helping the risk-on sentiment was a flurry of M&A activity.
Spark Therapeutics shares more than doubled after Swiss drugmaker Roche Holding AG agreed to buy the company for $4.3 billion.
Canadian miner Barrick Gold Corp offered to buy U.S. rival Newmont Mining Corp for nearly $18 billion. However, Newmont`s shares dipped 0.2 percent as the offer price was at a discount.
Among losers were the defensive sectors - consumer staples, utilities and real estate.
Advancing issues outnumbered decliners by a 1.50-to-1 ratio on the NYSE and by a 1.57-to-1 ratio on the Nasdaq.
The S&P index recorded 58 new 52-week highs and two new lows, while the Nasdaq recorded 119 new highs and 10 new lows.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
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