U.S. stocks rise on trade optimism; pound soars on impending Brexit deal
NEW YORK (Reuters) – Wall Street stock prices rose on Tuesday as investors hoped U.S.-China trade tensions could ease, while the pound soared on rising prospects for a finalized agreement on the United Kingdom’s exit from the European Union.
Oil prices fell more than 3 percent, but U.S. natural gas futures soared to their highest since November 2014 on forecasts for colder weather.
The U.S. benchmark S&P 500 stock index .SPX rose on reports that U.S. Treasury Secretary Steven Mnuchin had resumed discussions with China Vice Premier Liu He. Technology stocks bounced back a day after a rout that led the S&P 500’s nearly 2 percent decline.
U.S. equities rose further after White House Economic Advisor Larry Kudlow said Washington had resumed trade talks with China and characterized the development as “very positive.”
“It’s potentially good news on the trade war front,” said Edmund Tran, equity strategist at UBS Global Wealth Management in New York. “Any incremental news point is going to drive market volatility, whether up or down.”
The U.S. dollar index .DXY, which has steadily climbed as the U.S.-China trade dispute has escalated, dipped 0.4 percent.
Conversely, the pound GBP=D3 rose 1.4 percent to $1.3033 after reports that the United Kingdom and the European Union had agreed upon the text of a Brexit agreement and that British Prime Minister Theresa May would hold a cabinet meeting on Wednesday.
The euro EUR=EBS also rose from a 16-month low, last up 0.6 to $1.1282, though its gains were capped by concerns over Italy’s budget. The Italian government faces a Tuesday deadline to submit a revised budget to the EU.
The Dow Jones Industrial Average .DJI rose 32.82 points, or 0.13 percent, to 25,420, the S&P 500 .SPX gained 14.02 points, or 0.51 percent, to 2,740.24 and the Nasdaq Composite .IXIC added 62.16 points, or 0.86 percent, to 7,263.03.
The pan-European STOXX 600 added 0.67 percent to 364.44. MSCI’s gauge of stocks across the globe .MIWD00000PUS gained 0.36 percent.
Benchmark 10-year U.S. Treasury notes US10YT=RR last rose 8/32 in price to yield 3.1599 percent, from 3.189 percent late on Friday. The Treasury market was closed on Monday for the Veterans Day holiday.
Oil prices extended their fall from Monday after U.S. President Donald Trump put pressure on OPEC not to cut supply to prop up prices.
U.S. crude CLc1 fell 4.27 percent to $57.37 per barrel and Global benchmark Brent crude LCOc1 was down $2.70 a barrel at $67.42.
Both crude benchmarks have fallen more than 20 percent since peaking at four-year highs in early October.
But front-month gas futures NGc1 on the New York Mercantile Exchange jumped 6.1 percent, and the session high was its highest since Nov. 28, 2014.
Source: Read Full Article