Markets quiet on heels of trade war deal

Wall Street closed out a listless day Friday with tiny gains and more record highs for the S&P 500 and Nasdaq.

The U.S. and China revealed that they have reached an initial deal in their long-running trade war. The “Phase 1” agreement means that the U.S. won’t impose new tariffs on Chinese goods that had been set to kick in this weekend. Investors’ anxiety over the prospects of such an escalation in the trade war contributed to a sluggish start for the market this month.

Technology companies, which rely heavily on China for sales as well as parts, led the gainers Friday, outweighing losses in banks, energy stocks and elsewhere. Bond prices rose, pulling yields lower.

Optimism over the possibility of a trade deal helped stocks rebound after a downbeat start to the week.

The S&P 500 ended the week with its third straight weekly gain. With less than three weeks left in 2019, the benchmark index is up 26.4 percent for the year.

In the technology sector Friday, Adobe climbed 3.9 percent after its latest quarterly results topped Wall Street’s estimates.

Utilities, household goods makers and real estate stocks also notched gains.

Banks fell the most as bond yields, which are used to set the interest rates that lenders charge on mortgages and other consumer loans, fell. Wells Fargo slid 1.1 percent.

The yield on the 10-year Treasury dropped to 1.83 percent from 1.90 percent late Thursday.

The government said U.S. retail sales rose at a seasonally adjusted 0.2 percent rate in November. The modest pace fell short of analysts’ forecasts for a pickup of 0.5 percent and suggests that the holiday shopping season got off to a slow start. Shares in several department store chains fell. Macy’s dropped 3.4 percent, while L Brands slid 4.2 percent and Nordstrom lost 3.3 percent.

Facebook fell 1.3 percent amid reports that the Federal Trade Commission could block the company from integrating its messaging apps. Facebook has been planning to integrate those apps, including Messenger and What’sApp, since early 2019. Federal regulators are concerned that the plan could make it hard to break up the company should the FTC find that necessary.

British stocks and the British pound moved sharply higher a day after a resounding victory for the Conservative Party eased uncertainty over the nation’s upcoming exit from the European Union. The benchmark FTSE 100 rallied 1.1 percent. The British pound rose to $1.3339 from $1.3134. Other European markets also closed higher.