(Reuters) – Gains in technology stocks lifted the S&P 500 to a record high on Monday, powered by growing optimism around U.S.-China trade talks and a likely reprieve for Chinese telecoms company Huawei.
FILE PHOTO: Traders work on the floor at the New York Stock Exchange (NYSE) in New York, U.S., June 17, 2019. REUTERS/Brendan McDermid/File Photo
The benchmark index .SPX hit an intraday high of 2,977.93, surpassing its previous record high of 2,964.15 touched on June 21, as the truce agreed upon at the G20 summit boosted risk appetite.
“We’re right back on track,” U.S. President Donald Trump said after the world’s two largest economies agreed to restart talks. Trump also offered concessions including no new tariffs and an easing of restrictions on Huawei Technologies Co Ltd [HWT.UL], while China agreed to make unspecified new purchases of U.S. farm products.
Tech stocks .SPLRCT, which are Wall Street’s top performers so far in 2019, jumped 1.80%, with heavyweight Apple Inc’s (AAPL.O) 2.9% gain providing the maximum support.
Chipmakers with a sizable revenue exposure to China jumped, fueling a 3.76% gain in the Philadelphia Semiconductor index .SOX. Huawei suppliers Intel Corp (INTC.O) gained 1.4%, while Micron Technology Inc (MU.O) surged 6.1%.
“Any step toward a trade resolution, and it doesn’t have to be a lot of progress – just a step, is viewed very positively by markets,” said Scott Brown, chief economist at Raymond James in St. Petersburg, Florida.
“And investors at this point are trying to focus on the positive in hopes that there will be some trade resolution down the line.”
Stocks saw their steepest sell-off this year in May after a breakdown in the U.S.-China trade negotiations sparked concerns of a global economic slowdown.
However, expectations of a more accommodative Federal Reserve helped the S&P 500 and the Dow