Wall Street climbs as U.S. and China trade deal nears

January 14, 2020 - 6 months ago
Share on twitter
Share on facebook
Share on linkedin
Share on email

Wall Street kicks-off a busy week on a high note on optimism about the imminent signing of a preliminary U.S. and China trade deal as well as the start of the fourth-quarter corporate earnings season.

On Monday, all three major U.S. stock indexes resumed their rally that started last week amid news the U.S. will remove China from a list of currency manipulating countries, increasing optimism ahead of the signing of a key trade agreement.

The deal, which is scheduled for signing on Wednesday, is expected to lower tariffs on some Chinese-made goods, as well as increase China’s purchases of U.S. agricultural products.

After a lengthy translation process in recent weeks, Treasury Secretary Steven Mnuchin said China’s commitments remained unchanged. Mnuchin noted on Sunday that this is “a very, very extensive agreement.”

Meanwhile, the South China Morning Post reported the Chinese government said the trade war is “not over yet,” adding the signing of Wednesday’s agreement is just the “first round of a game.”

The top five U.S. companies Apple, Microsoft, Alphabet, Amazon and Facebook — now make up 18% of the total market capitalisation of the S&P 500 with the overnight’s session posting a +22.16 points gain, or +0.68% to 3,287.51, while the Dow Jones Industrial Average rose +82.54 points, or 0.29%, to 28,906.31, with the tech-heavy Nasdaq Composite Index gaining +95.07 points, or +1.04%, to 9,273.93.

Elsewhere, Tesla shares rose +8.5% after an analyst at Oppenheimer hiked his price target on the stock to $612 per share from $385 per share.

The analyst said Tesla’s “risk tolerance … and larger ambition than peers are beginning to pose an existential threat to transportation companies that are unable or unwilling to innovate at a faster pace.” The stock broke above $500 for the first time.

Share on twitter
Share on facebook
Share on linkedin
Share on email

Leave a Reply

Close Menu