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story.lead_photo.caption Specialist David Haubner works on the floor of the New York Stock Exchange, Thursday, Jan. 9, 2020. Stocks are opening broadly higher on Wall Street as traders welcome news that China's top trade official will head to Washington next week to sign a preliminary trade deal with the U.S. (AP Photo/Richard Drew)

NEW YORK (AP) — Stocks around the world climbed on Thursday, and U.S. indexes hit records as markets continued a rally sparked after the United States and Iran appeared to step away from the edge of war.

Money flowed into riskier investments, such as technology stocks, and trickled out of traditional hiding spots for investors when they’re nervous, such as gold. A measure of fear in the stock market had its largest drop in a week.

Stocks have been rallying since Wednesday, after investors took comments from President Donald Trump and Iranian officials to mean no military escalation is imminent in their tense conflict. It was a sharp turnaround from earlier days, when markets tumbled on the threat of war after the United States killed a top Iranian general in a drone strike.

The S&P 500 rose 21.65 points, or 0.7 percent, to 3,274.70 and surpassed its record set last week. The Dow Jones Industrial Average climbed 211.81 points, or 0.7 percent, to 28,956.90, and the Nasdaq composite rose 74.18, or 0.8 percent, to 9,203.43. Both also hit records.

Diminishing worries about a U.S.-Iran war put more of the market’s focus on the economy, corporate profits and other inputs that directly affect stock prices.

Across markets, worries about a recession have faded since last year as central banks cut interest rates and pumped stimulus into the global economy. The United States and China also moved toward an interim deal in their trade war. China confirmed on Thursday that its chief envoy in tariff talks with Washington will visit next week to sign their “Phase 1” trade deal.

The spotlight will move next to Friday’s labor report, and economists expect it to show employers added 160,000 jobs last month. They also forecast the unemployment rate to hold at its low level of 3.5 percent. The numbers are key because a strong job market has been propping up the economy and allowing U.S. households to continue to spend, even as manufacturing weakens due to tariffs and trade wars.

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