US stocks surge on US-China trade deal optimism
FILE- In this Feb. 5, 2019, file photo traders Joseph Lawler, left, and James Lamb work on the floor of the New York Stock Exchange. The U.S. stock market opens at 9:30 a.m. EST on Tuesday, Feb. 12. (AP Photo/Richard Drew, File)
U.S. stocks marched broadly higher in afternoon trading Tuesday amid renewed optimism over the potential for a trade deal between the U.S. and China.
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Technology companies and banks powered much of the rally, which had the market on track for its biggest gain this month and a three-day winning streak for the S&P 500 index.
President Donald Trump said Tuesday that he might let a March 2 deadline slide in trade talks with China if the two countries get close to a deal.
Trump said he's not inclined to extend the deadline, but he might let it "slide for a little while" if talks go well. Earlier, the White House had called March 2 a "hard deadline."
Both nations are trying to reach a deal before March 1. That's when additional tariffs will kick in, escalating the conflict and further hurting companies and consumers with higher prices on materials and products.
Meanwhile, lawmakers in Washington reached a tentative deal to avoid another partial government shutdown, a move that alleviates another source of uncertainty for the market ahead of the U.S.-China trade talks.
Elsewhere, companies were wrapping up an earnings season that's featured solid profit growth for the final three months of 2018, but caution about conditions going forward. Analysts predict profits will fall in the current quarter, according to FactSet.
Brewer Molson Coors fell as lower volume reduced revenue and profit. Under Armour rose after stronger sales helped it beat forecasts.
KEEPING SCORE: The Dow Jones Industrial Average climbed 379 points, or 1.5 percent, to 25,432 as of 3:26 p.m. Eastern Time. The S&P 500 index gained 1.4 percent, while the Nasdaq composite rose 1.5 percent. The Russell 2000 index of smaller-company stocks, which has been leading the other indexes this year, added 1.1 percent. European markets finished higher.
THE QUOTE: "Any deal would help alleviate some of the uncertainty," said Karyn Cavanaugh, senior markets strategist at Voya Investment Management. "The GDP hasn't been dinged that much from the trade tariffs, it's really been the uncertainty. It's spilling over into business plans and that's a hurdle for growth."
TECH TEARS IT UP: Technology stocks helped power the market's gains Tuesday. Symantec was among the sector's biggest gainers, climbing 4.4 percent.
FLUSHED: Investors also bid up shares in banks and other financial sector stocks. Brighthouse Financial surged 12.8 percent.
ACTIVE WEAR: Under Armour climbed 6.6 percent after the maker of sportswear beat Wall Street forecasts. A surge in international sales offset a downturn in Under Armour's U.S. sales.
FAULTY TAP: Molson Coors plunged 8.7 percent as lower sales volume sunk revenue and profit during the fourth quarter. The brewer will also restate some past results. The maker of Molson and Coors beer said tax accounting errors in 2016 and 2017 prompted the restatements.
MORE FOUNDATION: German conglomerate JAB Holdings hopes to take a majority stake in Coty Inc., the maker of CoverGirl, Max Factor and Hugo boss cosmetics.
JAB is offering to buy up existing stock from shareholders at $11.65 per share, a 20 percent premium from its closing price on Monday. The goal is to eventually own 60 percent of the company's stock. Coty's CEO, Camillo Pane, recently resigned from the company, which faces supply chain and revenue difficulties.
Coty's shares jumped 13.1 percent.
OIL & GAS: U.S. benchmark crude rose 1.3 percent to settle at $53.10 per barrel in New York. Brent crude, the standard for international oil prices, gained 1.5 percent to close at $62.42 per barrel in London.
In other energy futures trading, wholesale gasoline added 0.6 percent to $1.43 a gallon. Heating oil climbed 0.9 percent to $1.90 a gallon. Natural gas gained 1.7 percent to $2.69 per 1,000 cubic feet.
BOND WATCH: Bond prices fell. The yield on the 10-year Treasury rose to 2.69 percent from 2.66 percent late Monday.
CURRENCIES: The dollar rose to 110.52 yen from 110.40 yen on Monday. The euro strengthened to $1.1331 from $1.1276.
METALS: Gold added 0.2 percent to $1,314 an ounce. Silver was little changed at $15.69 an ounce. Copper dropped 0.6 percent to $2.77 a pound.
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