Wall Street boosted by advances in trade

Wall Street boosted by advances in trade

Saturday, 12.10.2019

Wall Street's flagship index, the Dow Jones Industrial Average, gained 1.21% to 26,816.59 points.

The Nasdaq, with strong technological color, rose 1.34% to 8,057.04 points, and the expanded S & P 500 index gained 1.09% to 2,970.27 points.

The indexes rose even higher during the session as US President Donald Trump distilled positive comments on the ongoing negotiations between US and Chinese representatives, welcoming among others the atmosphere "warmer" between delegations.

The Dow Jones even came close to 2% when the White House tenant said at the end of the meeting that the two sides had reached a partial trade agreement.

"We have reached a very important phase 1 agreement," the US president told reporters after meeting with Liu He, China's chief negotiator.

In the absence of concrete details immediately available, however, the indices lost some ground just before closing.

"We've been waiting all day for details on this deal (…) and the little that emerges seems to be more limited than expected," said Christopher Low of FTN Financial.

"Nonetheless, this is very good news and the earnings of the day are added to those garnered the day before in the anticipation of this announcement," he added.

Yields in the bond market rose sharply after the announcement of the agreement, sign, he said, "that fears of recession have decreased significantly among investors."

The 10-year US debt rate rose to 20:20 GMT at 1.731%, against 1.668% at the close on Thursday.

Over the week, the Dow Jones and Nasdaq appreciated by 0.9% and the S & P 500 by 0.6%.

Phase 1 of the agreement, according to Donald Trump, includes purchases of agricultural goods but also items including intellectual property, financial services and an exchange rate component.

Secretary of the Treasury, Steven Mnuchin, for his part said that the United States renounced the increase in tariffs on 250 billion dollars worth of goods imported from China, which were to increase from 25 to 30% on October 15.

The Chinese negotiator, for his part, spoke of "substantial progress in many areas" and hinted that the discussions would continue.

Wendy's in Europe

The first two world economic powers have been engaged for more than a year in a trade war waged by heavy taxes on imports.

With these tensions weighing on global economic growth and corporate earnings, investors welcome any signal of appeasement.

Multinationals particularly sensitive to Sino-US relations have benefited anyway, the manufacturer of Caterpillar construction equipment amounting for example 4.61%, the chemical seller Dow of 5.05% and the computer giant Apple's 2.66%, recording a record.

The semiconductors were also in shape: Micron Technology appreciated by 4.21%, AMD by 4.83%, Nvidia by 1.62% and Qualcomm by 2.31%. Like the large Chinese companies listed on Wall Street like Alibaba (+ 4.14%).

The Boeing manufacturer rose 1.06%. A committee grouping the world's civil aviation authorities, however, in a report released Friday, lambasted the American Air Regulator (FAA) who certified the Boeing 737 MAX.

The airline company United Airlines (-0.22%) has also announced in turn Friday that it postponed to January the date of a possible return to service of the 737 MAX, whose global fleet has been grounded since mid-March following two crashes that killed 346 people.

Wendy's fast food chain climbed 3.95% after announcing plans to serve breakfast at all US restaurants and expand to Europe, starting with the UK. (AWP)