Stocks spike on trade optimism

Trump, who met with Chinese Vice Premier Liu He Friday afternoon, called the initial deal “substantial.” Trade has dominated markets once again this week, with stocks rising and falling in lockstep with headlines. Details of the agreement are still emerging, but it includes a halt on US tariff increases. Trump told reporters that intellectual property theft, currency matters and agricultural purchases are also included in the deal. The president said in a tweet earlier Friday that “good things are happening” at the trade meetings and that “all would like to see something significant happen.” Stocks are sharply higher across the board. The Dow (INDU) soared more than 500 points at its peak, but pared some of its gains before the close. The index finished 320 points, or 1.2% higher. The S&P 500 (SPX) closed up 1.1%, while the Nasdaq Composite (COMP) finished 1.3% higher. All three indexes are on track for a gain this week, the first in three weeks for the Dow and the S&P 500. But if anything has been learned throughout the US-China trade negotiations, it’s that a tweet or a new headline can change the market’s sentiment at the drop of a hat. “Everyone is kind of narrowing in on this idea that we will get a smaller, partial deal — a phase one deal, if you will — and the worry about the trickier bits later,” said Michael Arone, chief investment strategist at State Street Global Advisors. “Investors always overreact and then they adjust relative to the details. That’s what we’re seeing here,” Arone added. Some economic data that could have derailed Friday’s rally was University of Michigan consumer sentiment, which over the past months showed growing concerns about trade tensions. But the survey-based index beat expectations, with the negative impact of trade

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