Stocks hit record highs on China trade news

NEW YORK — In the stock market, it’s all about trade now.

Stocks were jumping early Thursday after China said both sides in the U.S.-China trade war had agreed to roll back tariffs if their talks progress. But an afternoon report from Reuters citing fierce opposition within the White House to the agreement undercut the enthusiasm, and the majority of the market’s gains evaporated.

By the end of trading, the S&P 500 was up 8.40 points, or 0.3 percent, at 3,085.18. It managed to set a record for the second time this week, but it had been on pace for a bigger, 0.7 percent gain earlier in the day.

The Dow Jones Industrial Average climbed 182.24, or 0.7 percent, to 27,674.80 and also set a record. The Nasdaq composite finished just shy of its all-time high after rising 23.89, or 0.3 percent, to 8,434.52.

Encouraging reports on the economy and corporate profits have helped drive stocks back to record heights in recent weeks. The U.S. job market remains strong, and the Federal Reserve has cut interest rates three times since the summer to bolster the economy. Earnings for big companies, meanwhile, weren’t as bad in the summer as Wall Street had feared.

“It’s not that trade is more important to the market than economic growth or than the Fed,” said Steve Chiavarone, equity strategist at Federated Investors. “It’s that the market has already priced in that picture” of a still solid economy and easier interest rates.

“What’s left to be determined is trade, and there’s a greater amount of uncertainty because we’ve had head fakes before.”

Altogether, the improvements mean the worries about a possible recession that dominated markets just a few months ago are diminishing. That in turn has more on Wall Street confident that this bull market for stocks, which already is the longest on record, can keep going.

In a sign of increased optimism about the economy, the yield on the 10-year Treasury climbed to 1.92 percent from 1.81 percent late Wednesday. It has risen sharply over the last five weeks and is close to its highest level since the start of August.

Energy stocks jumped 1.6 percent for the largest gain among the 11 sectors that make up the S&P 500, and financial stocks climbed 0.7 percent.

Benchmark crude oil rose 80 cents to settle at $57.15 a barrel. Brent crude oil, the international standard, rose 55 cents to $62.29 a barrel. Wholesale gasoline rose 1 cent to $1.64 per gallon. Natural gas fell 6 cents to $2.77 per 1,000 cubic feet.