NEW YORK (AP) — Industrial and technology companies led stocks to solid gains Monday after the U.S. and China appeared to make significant progress in trade talks. That helped ease concerns among investors that the world’s two biggest economies might be headed for a trade war.
After another round of talks, the two countries agreed not to place tariffs on goods imported from the other. The Chinese government said it will buy more U.S. goods, including energy and agricultural products, while Treasury Secretary Steven Mnuchin said the U.S. postponed its proposal to put tariffs on up to $150 billion in goods from China. The two sides gave no indication of how much progress they had made toward ending their dispute entirely and both said hostilities could increase again.
Mark Hackett, chief of investment research at Nationwide Investment Management, said investors overreacted to the possibility of a trade war and they may be slowly learning to take a more patient approach with statements by the Trump administration and other nations, which is a good thing, Hackett said, because future administrations may borrow from Trump’s aggressive style.
“Treating Trump literally is destructive for investors,” he said. “There’s a lot of these issues where there are going to be hyperbolic statements made in the public sphere by both sides.”
The S&P 500 index climbed 20.04 points, or 0.7 percent, to 2,733.01. The Dow Jones industrial average rose as much as 371 points during the morning and finished with a gain of 298.20 points, or 1.2 percent, to 25,013.29. The Nasdaq composite gained 39.70 points, or 0.5 percent, to 7,394.04.
The Russell 2000 index of smaller-company stocks set another record close as it jumped 10.81 points, or 0.7 percent, to 1,637.44.
All 11 sectors in the S&P 500 index finished higher. Among industrials, Boeing gained 3.6 percent to $363.92 and construction equipment maker Caterpillar rose 2.1 percent to $158.92. In the financial sector, Bank of New York Mellon added 1.3 percent to $57.72 and JPMorgan Chase rose 0.9 percent to $112.15.