Strong gains at Wall Street

Indices boosted by U.S.-China trade optimism

US stocks ended with strong gains on Tuesday, 18 June 2019. The stock market rallied on Tuesday, boosted by U.S.-China trade optimism and dovish comments out of the European Central Bank (ECB). Each of the major indices advanced between 1.0% and 1.4%.

The Dow Jones Industrial Average rose 353.01 points, or 1.4%, at 26,465.54. The S&P 500 index advanced 28.08 points, or 1%, at 2,917.75, at 2,945.83, while the Nasdaq Composite Index climbed 108.86 points, or 1.4%, at 7,953.88.

The advance began overnight after ECB President Mario Draghi said the central bank is willing to provide additional stimulus if economic conditions don't improve and inflation remains low. The stock market rallied on Tuesday, boosted by U.S.-China trade optimism and dovish comments out of the European Central Bank (ECB). The advance began overnight after ECB President Mario Draghi said the central bank is willing to provide additional stimulus if economic conditions don't improve and inflation remains low.

Uncertainty about the global economy and the trade conflict have helped to drive appetite for precious metals. On Tuesday, however, U.S. President Donald Trump hinted at progress in trade talks with China.

Economic data at Wall Street showed that Housing starts dipped 0.9% over the month in May to a seasonally adjusted annual rate of 1.269 million from an upwardly revised 1.281 million (from 1.235 million) in April. Permits increased 0.3% in May to a seasonally adjusted annual rate of 1.294 million from an upwardly revised 1.290 million (from 1.269 million) in April. The key takeaway from the report was that the number of units under construction at the end of the period held at a seasonally adjusted annual rate of 1.131 million for the third straight month. That left the second quarter average 1.5% below the first quarter average, which will be a negative input for Q2 GDP forecasts.

Facebook shares on Tuesday fell 0.3% after the social-media giant unveiled its cryptocurrency, Libra coin, offering users the ability to make payments on the internet. Shares of Snapchat-parent Snap Inc. rose nearly 10% after an analyst expressed increased optimism about the technology company's latest attempts to monetize its platform and drive user growth.

Bullion prices ended higher at Comex on Tuesday, 18 June 2019. Gold prices climbed on Tuesday to settle at their highest in 14 months, as comments made by European Central Bank President Mario Draghi were seen as setting the stage for lower interest rates. Draghi's comments came ahead of the U.S. Federal Reserve's monetary policy statement due Wednesday.

August gold climbed $7.80, or 0.6%, to settle at $1,350.70. July silver gained 16.4 cents, or 1.1%, at $14.993 an ounce.

Crude oil futures rallied on Tuesday, 18 June 2019 with U.S. prices settling at their highest in over a week, after a tweet from U.S. President Donald Trump suggested progress in trade talks with China, lifting benchmark stock indexes and easing concerns over energy demand.

On Tuesday, West Texas Intermediate crude for July delivery rose $1.97, or 3.8%, to settle at $53.90 a barrel on the New York Mercantile Exchange.

August Brent crude added $1.20, or 2%, at $62.14 a barrel on ICE Futures Europethe highest settlement in a week.

The dollar index rose 0.1% on Wednesday.

U.S. Treasuries spent a bulk of intraday action pulling back from session highs, leaving yields slightly lower. The 2-yr yield declined one basis point to 1.84%, and the 10-yr yield declined three basis points to 2.06%.

Looking ahead, investors will receive the FOMC's Rate Decision and the weekly MBA Mortgage Applications Index on Wednesday.

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