Stocks bounce on trade-talk hopes

News that the U.S. and China are open to negotiating to avert a trade war put investors in a buying mood Monday, giving the market its best day in more than two years and erasing about half of its huge losses from last week.

Technology companies accounted for much of the broad rally, which powered the Dow Jones industrial average to a gain of nearly 670 points. Microsoft was the biggest gainer in the 30company Dow and in the Standard & Poor’s 500 index, climbing nearly 8%.

Banks also notched solid gains, benefiting from an uptick in bond yields. Retailers, consumer goods companies and healthcare stocks were among the big gainers.

The market rebound followed the worst week for U.S. stocks in two years. On Monday, investors traded last week’s jitters for a more optimistic outlook on trade and an opportunity to buy.

“Certainly nothing’s settled,” said Rob Haworth, senior investment strategist at U.S. Bank Wealth Management. “Investors are still viewing this as a glass-halffull market and a constructive economy, so it’s not surprising to see them buy on value here, buy on dips to try to rebuild their positions.”

The S&P 500 rose 70.29 points, or 2.7%, to 2,658.55. The Dow Jones industrial average jumped 669.40 points, or 2.8%, to 24,202.60. The Dow lost more than 1,400 points last week and is still down slightly for the year.

The tech-heavy Nasdaq leaped 227.88 points, or 3.3%, to 7,220.54. The Russell 2000 index of smaller-company stocks climbed 33.63 points, or 2.2%, to 1,543.72.

All told, the Dow, S&P 500 and Nasdaq posted their best one-day gains since August 2015, regaining more than half the ground that the market lost Thursday and Friday.

Global stock markets fell sharply last week amid fears of a trade war after President Trump announced duties on $60 billion worth of Chinese goods in a dispute over technology policy.

On Friday, Beijing released a list of $3 billion worth of U.S. goods targeted for possible retaliation over an earlier U.S. tariff hike on steel and aluminum imports. That prompted fears the spat might depress trade worldwide and set back the global economic recovery.

Those fears eased Monday, after China’s government said it is open to negotiating with Washington. That announcement followed a news report indicating that U.S. officials have submitted a list of marketopening requests.

A foreign ministry spokeswoman, Hua Chunying, didn’t confirm the report by the Wall Street Journal but said at a regular briefing, “Our door for dialogue and discussion is always open.”

Meanwhile, a top trade negotiator for South Korea said Monday that the nation has agreed to further open its auto market to the United States as the two countries prepare to amend their 6-year-old trade agreement.

Technology companies recouped some of the sector’s big losses from last week. Microsoft rose 7.6% to $93.78.

Financial stocks surged as bond yields rose.