Dow jumps 400 points as trade war fears cool

Wall Street stocks surged last night amid bargain-hunting and hopes that the United States and China could negotiate new terms of trade and avoid a trade war.

But yesterday, USA stock indices regained about half their recent losses, with both the Dow industrials and the S&P 500 surging about 2.75 percent.

All eleven major sectors of the S&P 500 were in positive territory, led by technology and finance indexes, up 3.2 percent and 2.8 percent, respectively.

US Treasury Secretary Steven Mnuchin called China's Liu He to congratulate Liu on his appointment this month as vice premier in charge of economic policy, said the person.

USA stocks tumbled on both on Thursday and on Friday last week after President Donald Trump unveiled tariffs on up to $60bn of Chinese imports and vowed to counter China's alleged "theft" of American intellectual property.

"There are some tentative signs that fears of an escalation of trade tensions are beginning to ease", Craig Erlam, a market analyst at OANDA wrote in a note to clients.

The tech sector was on pace for its biggest daily percentage gain since January 2016 and financials were poised for their best day since March 2017.

Gold dips as trade war fears ease

"A rebound in global equities overnight is offering the market some optimism of stabilization after last week's rout".

Technology shares were strong, with Apple advancing 4.8%, Intel 6.3%, Netflix and Adobe Systems both 6.5%. They, along with other industrial stocks, have taken a beating in the wake of Mr. Trump's tariffs plans due to their exposure to China.

Stocks recovered after indexes lost more than 6 percent last week - their worst weekly decline in two years - in the wake of tariffs imposed by the US and China against each other.

Japan's Nikkei, meanwhile, erased earlier losses of 1.3 per cent to end 0.7 per cent higher. As NPR's John Ydstie reports, the two countries have begun talks aimed at avoiding tit-for-tat sanctions that could damage both sides.

China then responded to news of the planned tariffs by saying it did not want a trade war, but it was "absolutely not afraid" of one.

Brent crude futures were up 9 cents at $70.54 a barrel.

U.S. President Donald Trump last week signed a memorandum that could impose tariffs on up to $60 billion of imports from China. "The trade tensions imperil growth", said Michael McCarthy of CMC Markets in a report.



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