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Stocks rose on Thursday on the back of a report that said the U.S. could ease tariffs on Chinese goods during trade negotiations with China.
A Wall Street Journal report said that idea was floated by Treasury Secretary Steven Mnuchin. The report, however, added that Mnuchin faced pushback from U.S. Trade Representative Robert Lighthizer, who thinks any concession could be seen as a sign of weakness.
The major indexes came off their highs after a Treasury Department spokesperson working with the trade team told media outlets: "Neither Secretary Mnuchin nor Ambassador Lighthizer have made any recommendations to anyone with respect to tariffs or other parts of the negotiation with China. This is an ongoing process with the Chinese that is nowhere near completion."
The Dow Jones Industrial Average came out of the shadows to hike 162.94 points to 24,370.10, lifting itself out of correction territory.
The S&P 500 gained 19.86 points to 2,635.96.
The NASDAQ Composite climbed 49.77 points to 7,084.46.
For the week, the major indexes are all up more than 1%.
Caterpillar shares spiked 2.2%, while Boeing jumped 2%. Caterpillar and Boeing shares are seen as bellwethers for global trade given their exposure to overseas markets. Apple also rose 0.6%.
Stocks had traded slightly higher earlier in the day as investors awaited Netflix’s quarterly results. Netflix is scheduled to report after the close Thursday. The stock has been on a tear so far this year, rising more than 31%. Netflix’s earnings will arrive after the streaming giant announced it would raise monthly subscription prices by 13% to 18%, a move that was cheered by Wall Street earlier this week. Dow member American Express is also set to report after the close.
Morgan Stanley reported earnings and revenue that fell short of Wall Street estimates. The company’s results were dragged down by poor performances in its trading and wealth management businesses. Morgan Stanley shares fell 4%.
Citigroup, J.P. Morgan Chase, and Wells Fargo also reported quarterly earnings this week.
Thursday’s moves come after the major indexes posted solid gains in the previous session, lifted by the sharp gains in Goldman and Bank of America.
Concerns over China appeared to weigh on sentiment Thursday. China’s central bank made its biggest ever daily net cash injection via reverse repo operations, pumping $82.73 billion U.S. into the banking system. The news came after comments from the Chinese state planner and Premier Li Keqiang suggested the country would inject more stimulus amid concerns of a slowdown in economic growth.
Prices for the benchmark for the 10-year U.S. Treasury sagged, lifting yields to 2.75% from Wednesday’s 2.73%. Treasury prices and yields move in opposite directions.
Oil prices dipped six cents to $52.25 U.S. a barrel.
Gold prices dropped $2.10 to $1,291.70 U.S. an ounce.
