Tech boosts Wall Street as trade war fears ebb

Traders work on the floor of the New York Stock Exchange in New York U.S
Traders work on the floor of the NYSE in New York Thomson Reuters

29 March, 2018

USA stocks enjoyed their largest one-day gains in more than two and a half years on Monday, with the S&P 500 index up 2.7%, as concerns of a trade war between United States and China eased.

In China, Hong Kong's Hang Seng index was up 0.8% in afternoon trade, while the Shanghai Composite rose 1.1%.

USA stocks were poised for further solid gains following Monday's advance, with Dow futures and the broader S&P 500 futures up 0.6 percent. Canada's main stock market closed the day at 15,169, a loss of 46 points.

The US asked China in a letter last week to slash tariffs on American cars, buy more US-made semiconductors and give US firms greater access to the Chinese financial sector, the Wall Street Journal reported on Monday.

Premier Li Keqiang said Monday China would treat foreign and domestic firms equally, not force foreign firms to transfer technology and would strengthen intellectual property rights.

Trade war jitters were stoked last week when U.S. President Donald Trump announced plans to impose tariffs on up to $60 billion of Chinese products.

"There are some tentative signs that fears of an escalation of trade tensions are beginning to ease", Craig Erlam, a market analyst at OANDA wrote in a note to clients.

"Equities are extending their rebound as investors breath a collective sigh of relief that a global trade war looks to be off the menu (China and USA negotiating, several exemptions)".

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At 9.34am local time on Monday, the Dow Jones Industrial Average was up 1.73 per cent at 23,939.32.

All eleven major sectors of the S&P 500 were in positive territory, led by technology and finance indexes, up 3.2 percent and 2.8 percent, respectively.

Microsoft pulled the indexes higher, gaining 6.9 percent.

Shares of Boeing and Caterpillar were up around two per cent, two companies who have been hit hard in recent weeks by tariff news.

everThe country's blue-chip indices saw an improved mood following last week's falls, which saw the S&P 500 suffer its worst weekly performance in more than two years.

Facebook's gains were a comparatively tepid 0.4% after the Federal Trade Commission confirmed news reports from last week that it had opened an inquiry over the harvesting of Facebook data on tens of millions of the social network's users by the British consulting group Cambridge Analytica.

Intel gained more than 3.4 per cent after brokerage Raymond James upgraded the stock to "market perform".

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