Wall St. higher on tech boost, trade hopes
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(Reuters) – U.S. stocks rose on Wednesday after comments from Treasury Secretary Steven Mnuchin’s fueled optimism that the United States and China were close to striking a trade deal, while the tech sector was boosted by chipmaker Micron’s upbeat results.
FILE PHOTO: Traders work on the main trading floor after the opening bell at New York Stock Exchange (NYSE) in New York, U.S. June 20, 2019. REUTERS/Brendan McDermid/File Photo
“We were about 90% of the way there (with a deal) and I think there’s a path to complete this,” Mnuchin said in an interview to CNBC.
Tech stocks were the biggest gainers among the 11 major S&P sectors, with a 1.53% jump, while the trade-sensitive industrial index rose 0.17%.
“Any good news on trade is good news for the equity markets. As long as the two countries are negotiating, it’s a good thing and that’s what is moving markets at this time,” said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago.
However, investors were cautious after President Donald Trump told Fox Business Network that he would impose additional tariffs on China if he did not reach a trade deal with Chinese president Xi Jinping.
Trump and Xi are set to meet at the Group of 20 summit in Japan on Friday.
At 9:52 a.m. ET the Dow Jones Industrial Average was up 31.66 points, or 0.12%, at 26,579.88 and the S&P 500 was up 6.24 points, or 0.21%, at 2,923.62.
The Nasdaq Composite was up 65.55 points, or 0.83%, at 7,950.27.
Micron Technology Inc jumped 11.2%, lifting the Philadelphia Semiconductor index 3.09% higher.
The company said it had resumed some shipments to Chinese telecoms equipment maker Huawei Technologies Co Ltd and still expected demand for its chips to recover later this year.
Also boosting the tech-heavy Nasdaq were gains in shares of Apple Inc, Microsoft Corp and Amazon.com Inc.
The S&P 500 index has gained 6.4% so far in June, hitting a record high last week, largely on hopes that the Federal Reserve would cut interest rates to counter the impact of a U.S.-China trade war.
But the three main indexes fell sharply on Tuesday after Fed Chairman Jerome Powell pushed back on pressure from Trump to cut rates.
Still, traders fully expect a rate cut from the Fed in July and see a 25% possibility of a half-point move.
The biggest decliner among S&P 500 companies were General Mills Inc’s shares, which slipped 8.5% after the food packaging company missed quarterly sales estimates.
Data showed new orders for key U.S.-made capital goods rose more than expected in May and shipments increased solidly, suggesting some stabilizing in business spending on equipment after it fell early in the year.
Advancing issues outnumbered decliners by a 1.77-to-1 ratio on the NYSE and by a 1.69-to-1 ratio on the Nasdaq.
The S&P index recorded four new 52-week highs and one new low, while the Nasdaq recorded 12 new highs and 36 new lows.
Reporting by Shreyashi Sanyal and Aparajita Saxena in Bengaluru; Editing by Anil D’Silva