US Market sets records anew on trade deal boost

The US stock market finished session higher on Monday, 16 December 2019, with all three major U.S. stock indexes posting record finishes, on receding U.S.-China trade war woes after interim trade deal between the world's two biggest economies and refrained from slapping fresh tariffs on each other's goods on Sunday. Sentiment was also lifted by strong economic data out of China. At closing bell, the Dow Jones Industrial Average rose 100.51 points, or 0.36%, to 28,235.89, the S&P 500 gained 22.65 points, or 0.71%, to 3,191.45 and the Nasdaq Composite added 79.35 points, or 0.91%, to 8,814.23.

The market got a big confidence boost after Friday's announcement of a long-awaited "Phase 1" trade deal between the world's two biggest economies. The U.S. and China agreed last week to cut tariffs on some of each others' goods and postpone other tariff threats, the first time the two countries have stepped back from the brink in their 17-month trade fight. In return, China promised to ramp up its purchases of U.S. agricultural, energy and other goods and to stop forcing U.S. companies to turn over technology as a condition of doing business in that country. The trade pact removed some of the uncertainty that's hung over businesses and investors and has lifted prospects for the global economy.

Adding to the optimism, data released on Monday showed China's industrial output and retail sales growth accelerated in November. China's industrial production, which measures China's industrial output, including manufacturing, mining and utilities, grew by 6.2% in November, up from October's 4.7%. Meanwhile, retail sales grew by 8.0% in November, up from 7.2% a month ago.

Energy stocks were the market's best performers, after the price of oil added a bit to its gain last week and natural gas prices jumped. Benchmark U.S. crude rose 14 cents to $60.21 per barrel, close to its highest level in three months. Brent crude, the international standard, added 12 cents to $65.34 per barrel. Oil and gas producer EOG Resources climbed 3.2%, while Marathon Petroleum rose 3.7%.

Shares of chipmakers, among the most trade-sensitive stocks, also rose. Micron Technology jumped 3.4% and Broadcom rose 2.4%.

In economic reports, the Empire State manufacturing index came in at 3.5, slightly higher than November's 2.9 reading. Meanwhile, the Markit purchasing managers survey for the manufacturing sector was down a touch to 52.5 in December, from 52.6, but the services sector gauge came in at 52.2, from 51.6. Any number above 50 represents a pickup in economic activity.

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