Apple leads Wall Street rally as U.S. delays on tariffs

(Reuters) – U.S. stocks surged more than 1.5% on Tuesday after the Trump administration said it would delay 10% tariffs on some Chinese products, including laptops and cell phones, driving a 4% rally in shares of iPhone maker Apple Inc.

Traders work on the floor at the New York Stock Exchange (NYSE) in New York, U.S., August 13, 2019. REUTERS/Eduardo Munoz

In a statement, the administration also excluded video game consoles and certain items of footwear and clothing from the 10% rate, which had been scheduled to start next month, an abrupt pull-back from its hardline stance on trade.

That eased the fears of a recession driven by the protracted trade war that has dominated trading on Wall Street this year and spurred a bout of extreme volatility following President Donald Trump’s announcement of a new round of tariffs on Aug. 1.

“The escalation of the U.S. China trade war has been an overhang … and the fact that we have got a bit of a reprieve on that is putting a bit of optimism into markets,” said Art Hogan, chief market strategist at National Securities in New York.

“There was a risk that China would retaliate by not even showing up to the negotiating table, so now it feels like we got a step in the right direction towards negotiation and perhaps an end to the trade war.”

A 4.2% jump in shares of Apple, which makes iPhones and MacBooks in China, along with a rise in chip stocks pushed the technology sector 2.24% higher. The Philadelphia chip index .SOX rose 3.16%.

Industrial bellwethers 3M Co (MMM.N) and Caterpillar Inc (CAT.N), traditionally among the most sensitive to trade concerns and China, jumped about 3% each, while the S&P 500 retailing index .SPXRT also jumped 2.12%.

Wall Street’s main indexes had

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