Gains for Wall Street on back of trade war optimism

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  • U.S. stocks see three days of gains
  • Trade war tensions ease slightly
  • Fed taking stock of risks

Wednesday saw a modest but distinct rise for U.S. stocks as signs of trade talk progress between the United States and China set the scene for a fourth consecutive day of positive movement.

Ongoing trade tensions between the world’s two largest economies have ebbed and flowed since the meeting between Presidents Trump and Ji that took place at the G20 last year, but renewed optimism added to strong U.S. job market data have seen the S&P 500 rise by 9.7% from its 20-month low around Christmas.

“A substantial amount” of energy, agricultural, and manufactured goods and services will be purchased from the U.S. under the latest pledge from Beijing, according to the U.S. Trade Representative’s office after the latest round of talks ended. Subsequently, shares in Boeing Co rose by 1.2% because the company has such a big exposure to China.

Charles Schwab Vice President of Trading and Derivatives Randy Frederick noted: “There’s a solid uptrend that’s come off the Christmas Eve downturn. So any development that looks like it might be leading to an eventual resolution will be helpful to the markets.”

Signs that the Federal Reserve appears to be delaying action on interest rate hikes have also had a positive effect on markets.

Several Fed officials confirmed they were taking a cautious stance on further interest rates increases in order for the central bank to have time to assess risks. Some of the recent moves on Wall Street have been influenced by the Fed’s intentions regarding a tightening of policy.

Any change to the loosely stated schedule for further rate hikes is bound to have repercussions for the markets.

Brian Ducey

Brian graduated from Chaminade High School and the University Of Vermont Kalkin School Of Business with a concentration in Finance. He began his career with Knight Capital Markets, working his way to market maker. Brian later expanded his market repertoire, working with various sell-side research brokerage firms, such as Sidoti & Co., and William O’Neill & Co., as an Account Executive. With over 20 years-experience in the financial industry, Brian has built a unique perspective into “market intelligence” understanding an ability to read the tape and apply second level thinking in a fast paced environment. Brian also carried several market licenses, including the series 7, 24, 55, 65, and 63 licenses as well as previously passing The Connecticut Life and Health Insurance Exam