Wall Street rides on economic data, easing trade worries
NEW YORK — Wall Street indexes rallied on Wednesday with help from financial stocks as investors eyed strong economic data and trade war fears took a back seat while the Nasdaq registered its third straight record closing high.
White House economic adviser Larry Kudlow said late in the trading day that US President Donald Trump will meet French President Emmanuel Macron and Canadian Prime Minister Justin Trudeau during a Group of Seven (G7) summit this week. While he said Mr. Trump is not backing down from the tough line he has taken on trade, the comments appeared to calm investors.
Earlier reports citing sources said US officials were weighing an offer by China to import an extra $ 70 billion of American goods over a year as Beijing tries to defuse a potential trade war.
“The trade rhetoric has once again dialed back,” said Mona Mahajan, US Investment Strategist, Allianz Global Investors, New York. “It’s the on-again, off-again threat of protectionism. It’s off again.”
Mr. Trump last week pushed on with imposing tariffs — 25% on steel and 10% on aluminum — on Canada, the European Union and Mexico, with Mexico retaliating by putting tariffs on American products such as steel, pork and bourbon.
The Dow Jones Industrial Average rose 346.41 points or 1.40%, to 25,146.39; the S&P 500 gained 23.55 points or 0.86% to 2,772.35; and the Nasdaq Composite added 51.38 points or 0.67% to 7,689.24.
The benchmark 10-year US Treasury yield rose to a near twoweek high after data showed that the US trade deficit unexpectedly fell to a seven-month low in April, supporting the view of an acceleration of domestic economic growth in the second quarter.
The S& P financial sector, which rose 1.8%, was the S&P’s biggest boost as bank stocks rose along with Treasury yields. Higher interest rates tend to help bank profits. The bank index rose 2.3% as the sector was also helped by a rise in mortgage applications for the first time in seven weeks.
Nasdaq’s biggest boost was from Comcast Corp., whose shares rose 3.8%. Tesla shares jumped 9.7% after Chief Executive Officer Elon Musk reassured shareholders that building 5,000 of its mass-market Model 3 cars per week by the end of June was “quite likely.”
Advancing issues outnumbered declining ones on the NYSE by 1.83 to 1; on Nasdaq, a 1.54-to-1 ratio favored advancers.
The S&P 500 posted 57 new 52-week highs and 11 new lows; the Nasdaq Composite recorded 278 new highs and 24 new lows.
On US exchanges 6.88 billion shares changed hands, compared to the 6.64 billion average for the last 20 sessions. —