NEW YORK (Reuters) – World stock markets and U.S. benchmark bond yields gained on Thursday following strong economic data as investors assessed the latest developments in global trade relations.
Traders work on the floor at the New York Stock Exchange (NYSE) in New York, U.S., May 16, 2019. REUTERS/Brendan McDermid
A spike in U.S.-China tensions over import tariffs has convulsed markets recently as investors seek to parse statements from government leaders to gauge the direction of talks.
News that President Donald Trump is expected to delay auto tariffs appeared to improve the trade tone on Wednesday, but later in the day the Trump administration hit Chinese telecoms giant Huawei with severe sanctions.
“The market is really having a hard time pricing in this trade war,” said Mark Hackett, chief of investment research at Nationwide. “There was a belief earlier in the week that it was going to be catastrophic and we have gained back all of that decline. In my opinion, it is probably a little too optimistic to declare victory.”
On Wall Street, the Dow Jones Industrial Average rose 273.04 points, or 1.06%, to 25,921.06, the S&P 500 gained 37.33 points, or 1.31%, to 2,888.29 and the Nasdaq Composite added 107.94 points, or 1.38%, to 7,930.08.
Shares of Cisco Systems and Walmart both gave boosts to the S&P 500 and the Dow after their respective earnings reports. Cisco shares rose 6.4% and Walmart rose 3.3%.
The Philadelphia semiconductor index fell 0.9% following the Huawei news.
The pan-European STOXX 600 index rose 1.14%.
MSCI’s gauge of stocks across the globe gained 0.82%.
U.S. homebuilding increased more than expected in April and activity in the prior month was stronger than initially thought. In a separate report, the number of Americans filing applications for unemployment benefits fell more than expected last week.