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Global Markets: Hopes for U.S.-China trade talks boost stocks, oil

Reuters  |  NEW YORK 

By Saqib Iqbal Ahmed

NEW YORK (Reuters) - Stocks around the world extended recent gains and jumped on Wednesday on optimism that the and may be inching towards a trade deal, soothing fears of an all-out trade war and its possible impact on global growth.

Optimism that the would reach a trade agreement with boosted yields to their highest this year.

Delegations from and the U.S. ended talks in on Wednesday amid signs of progress on issues including purchases of U.S. farm and commodities and increased access to China's markets.

China has pledged to purchase "a substantial amount" of agricultural, and manufactured goods and services from the United States, the U.S. Trade Representative's office said on Wednesday.

MSCI's all-country index climbed 0.68 percent for a fourth day of gains.

That added to advances since last week in equity markets around the world, following strong U.S. employment report and comments from the Federal Reserve that calmed worries that U.S. interest rate hikes would hurt growth.

On Wednesday, a clutch of U.S. Federal Reserve officials said they would be cautious about any further increases in interest rates so that the central could assess growing risks to an otherwise-solid U.S. economic outlook.

Adding to the upbeat mood were reports that plans to introduce policies to boost domestic spending on items such as autos and home appliances this year. These come on the back of Friday's monetary easing by of China.

The U.S. stock market was supported by and technology sectors, and the S&P 500 index clung to gains that have lifted it by about 10 percent from 20-month lows hit around

"There's a solid uptrend that's come off the Eve downturn. So any development that looks like it might be leading to an eventual resolution will be helpful to the markets," said Randy Frederick, for in Austin,

The Dow Jones Industrial Average rose 57.06 points, or 0.24 percent, to 23,844.51, the S&P 500 gained 1.15 points, or 0.04 percent, to 2,575.56 and the Nasdaq Composite added 21.91 points, or 0.32 percent, to 6,918.90.

The pan-European STOXX 600 rose 0.46 percent to a nearly four-week high, with trade deal hopes boosting the region's export-oriented autos and tech sectors.

Optimism that the trade standoff would be resolved also lifted

U.S. Intermediate (WTI) were at $50.8 per barrel, up $1.02, or 2.05 percent, the first time this year that WTI has topped $50. International futures were up $1.07, or 1.82 percent, at $59.79 per barrel.

The dollar sank to its lowest since October, with gains led by the euro and sterling, as risk appetite improved and investors reduced their safe-haven bets.

"As long as you don't see a situation where there is a negative turn much like what we saw over the last quarter, markets will probably view any trade development, even if they're not concluded by the March 1 deadline, with modest optimism just because it reduces the downside risk to the outlook," said Mazen Issa, senior FX strategist, at in New York.

Improved risk appetite sent yields to their highest this year, ahead of the sale of new 10-year supply by the Treasury Department.

10-year notes were last down 5/32 in price to yield 2.7315 percent after earlier rising to 2.747 percent, the highest since Dec. 28.

Gold prices rose on Wednesday, with spot gold rising 0.41 percent to $1,290.1 per ounce.

(Reporting by Saqib Iqbal Ahmed; Additional reporting by in Bengaluru and Gertrude Chavez-Dreyfuss in New York; Editing by Bernadette Baum)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Wed, January 09 2019. 21:50 IST