US stocks gain as Chinese yuan stabilises

Business Traders work on the floor of the New York Stock Exchange. (AP Photo/Richard Drew) 07 Aug 2019 04:50AM(Updated: 07 Aug 2019 05:00AM) Share this content


NEW YORK: Wall Street stocks bounced on Tuesday (Aug 6), ending a multi-session losing streak as China moved to stabilise its currency amid the escalating US-China trade war.

Analysts pointed to steps taken by the Chinese central bank to boost the yuan, which slid below a key benchmark on Monday in a move seen as part of Beijing’s rebuttal to President Donald Trump’s latest tariff announcement.

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But the yuan steadied on Tuesday while People’s Bank of China Governor Yi Gang vowed that China would not engage in a competitive devaluation in the trade war. The move came after the US Treasury Department late Monday formally designated China a “currency manipulator.”

The Dow Jones Industrial Average rose 311.78 points (1.21 per cent) to 26,029.52, ending a five-day slide.

The broad-based S&P 500 gained 37.03 points (1.30 per cent) to 2,881.77, while the tech-rich Nasdaq Composite Index climbed 107.23 points (1.39 per cent) to 7,833.27. Both the S&P 500 and Nasdaq fell the last six days.

The China move “calmed the currency market and we saw the equity market and the futures market start to turn positive,” said Quincy Krosby, chief market strategist of Prudential Financial.

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But while this boosted sentiment to an extent, “heightened uncertainty continued to hamper sentiment,” said a stock market note from Charles Schwab.

Analysts say the recent spate of new actions by Beijing and Washington in the months-long trade war has dimmed hopes for a deal in the near-term, with some now seeing low odds of an agreement before the 2020 US presidential election.

Among individual companies, MasterCard rose

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