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Wall Street soars as China trade hope returns

Wall Street soars as China trade hope returns

A street sign for Wall Street outside the New York Stock Exchange (NYSE) in Manhattan, New York City. (Photo: Reuters/Andrew Kelly)

NEW YORK: China's hint that it might not retaliate against the latest US trade war salvo, sent Wall Street higher on Thursday (Aug 29), with trade-sensitive industrial and tech stocks leading indices upward.

The rally, which included a 300-point surge on the Dow Jones Industrial Average, nevertheless left stocks on track to finish the month in the red for the first time since May.

The Dow Jones Industrial Average rose 326.15 points (1.25 per cent) to 26,362.25 and the S&P 500 gained 36.64 points (1.27 per cent) to 2,924.58.

The tech-heavy Nasdaq added 116.51 points (1.48 per cent), settling at 7,973.39.

The gains came following China's Commerce Ministry statement that rather than retaliation, the next agenda item in the trade war should be cancelling President Donald Trump's latest round of tariffs, and that escalation was "not beneficial" for either side.

"People are holding out hope," Maris Ogg of Tower Bridge Advisors told AFP, although that optimism may prove short lived.

"If the trade wars go away or dissipates, clearly you have a healthier economic environment," she said. "But you need some concrete actions for this to have long term impact."

Among individual companies, trade-sensitive stocks like Apple, Boeing and Microsoft all rose.

But corporate earnings from retailers Best Buy, Abercrombie & Fitch and Dollar Tree all contained fresh warnings that new tariffs will be a direct threat to profits.

Despite posting better-than-expected quarterly earnings on Thursday, electronics retailer Best Buy plunged eight per cent.

Shares in US tobacco maker Altria fell 3.5 per cent, a day after Philip Morris International announced the two companies were contemplating a merger.

The Wall Street Journal reported on Thursday that the Federal Trade Commission was investigating potentially deceptive marketing practices by the e-cigarette maker JUUL, in which Altria maintains a significant stake.

Source: AFP/de


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