Dow gains 170 points as trade fears take a back seat to economic optimism

U.S. stocks traded firmly higher Thursday, resuming a recent uptrend that had been interrupted on Wednesday by a fresh intensification of tariff and political disputes between Washington and the rest of the developed world. However, upbeat data and signs that the U.S. and China, the two biggest economies in the world, are open to resolving their differences has helped to refresh some appetite for assets perceived as risky.

What are markets doing?

The Dow Jones Industrial Average DJIA, +0.60% rose 173 points, or 0.7%, to 24,872, while the S&P 500 index SPX, +0.49%  gained 14 points, or 0.5%, to 2,787. The Nasdaq Composite Index COMP, +0.76% rose 50 points, or 0.7%, to 7,767.

The gains come after a selloff on Wednesday, when U.S. stocks snapped a four-session winning streak as the Trump administration announced plans to impose another round of tariffs on Chinese goods. The Dow ended 0.9% lower, while the S&P  fell 0.7% and the Nasdaq Composite Index  shed 0.6%. Still, all three benchmarks are on pace to rise for five of the past six sessions.

What is driving the market?

The trading mood on Thursday morning may have been getting a boost from signs the U.S. and China are willing to resume trade talks, which could end up in a bilateral agreement. Bloomberg reported late Wednesday that officials from both countries have raised the prospects of restarting a conversation at a high level.

Fears of a full-blown trade war possibly developing between the world’s two largest economies have weighed on equities around the globe in recent months, although analysts have pointed out that markets have remained somewhat resilient.

Meanwhile, the U.S. consumer-price index increased 0.1% in June. Core CPI, minus volatile food and energy, rose 0.2% on the month. Moreover, the 12-month gain for CPI rose to a

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