Stocks bask in 'warmer feelings' from trade talks, Brexit deal hopes

NEW YORK (Reuters) – Stocks on Wall Street came off their highs in late trading after U.S. President Donald Trump announced a partial trade deal with China that could be signed within weeks, with the boost from New York enough to give stocks across the globe their largest daily gain in two months.

FILE PHOTO: A trader works on the floor of the New York Stock Exchange shortly after the closing bell in New York, U.S., October 2, 2019. REUTERS/Lucas Jackson

The British pound closed its strongest week against the dollar in over two years on hopes that Britain was moving closer to a smooth exit from the European Union and oil jumped over 2% after reports of an attack on an Iranian tanker.

The MSCI world equity index .MIWD00000PUS posted its first weekly rise in four. Frankfurt’s main stock index .GDAXI, seen as sensitive to trade wars because of its export-oriented components, ended up 2.9% for its biggest daily gain since January 4.

The U.S.-China deal agreed on Friday covers agricultural purchases, currency and some aspects of intellectual property protections, and it averted a tariff hike scheduled for next week, though there was no mention of tariffs set to rise in December.

The S&P 500 rose as much as 1.9% but ended the day up 1.1% after the agreement announcement triggered selling.

“Anything that was less than a comprehensive agreement was likely to see some degree of market selloff,” said Michael James, managing director of equity trading at Wedbush Securities in Los Angeles.

“The timing had a lot to do with the volatility. There were 15 minutes to go in the trading day on a Friday,” he said.

Investors had said they were hoping for, at best, a deal limited in scope, and noted

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