Wall Street rallied for the second consecutive day on Monday after resumption of trade related negotiations between the United States and China. Some positive developments in the trade war front have bolstered investors’ confidence to some extent. All three major stock indexes finished in the green.
The Dow Jones Industrial Average (DJI) closed at 23,531.35, gaining 0.4%. The S&P 500 Index (INX) rose 0.7% to close at 2,549.69. Meanwhile, the Nasdaq Composite Index (IXIC) closed at 6,823.47, climbing 1.3%. A total of 8.1 billion shares were traded on Monday, lower than the last 20-session average of 9 billion shares. Advancers outnumbered decliners on the NYSE by 3.69-to-1 ratio. On the Nasdaq, advancers had an edge over decliners by 3.05-to-1 ratio. The CBOE VIX increased 0.1% to close at 21.40.
How Did the Benchmarks Perform?
The Dow ended in positive territory for the second successive day. Notably, 22 components of the 30-stock blue-chip index finished in the green while the remaining eight closed in the red. The S&P 500 closed in positive territory for two consecutive days. The Consumer Discretionary Select Sector SPDR (XLY), Energy Select Sector SPDR (XLE) and Communications Services Select Sector SPDR (XLC) gained 2.3%, 1.5% and 1.1%, respectively. Notably, nine out of total 11 sectors of the benchmark index closed in the green.
The two-day long meeting between high level delegations of the United States and China resumed on Jan 7. The two sides will try to find out a possible trade deal to the ninth-month old dispute. Reuters reported that the Chinese foreign ministry confirmed on Monday that both sides have expressed the desire to work together in order to find an amicable solution.
The foreign ministry also stated that China wants to resolve trade disputes with the United States on an equal footing. Further, U.S. Commerce Secretary Wilbur Ross said he is very much hopeful that trade conflict will be resolved satisfactorily this time.
Notably, on Dec 1, U.S. President Donald Trump and his Chinese counterpart Xi Jinping reached an initial agreement to find a permanent solution to the trade-related conflict between the two countries. The truce will be valid for the next 90 days during which the two countries will try to solve bilateral trade conflicts.
The Institute for Supply Management (ISM) reported that its services index came in at 57.6 in December 2018, the lowest since February. The consensus estimate was 58.2 while the reading for November was 60.7. However, a reading over 50 indicates expansion of services sector while a reading above 55 indicates exceptional expansion of services sector. This indicates robustness of the U.S. services sector despite a slowdown in pace.
Importantly, no further government data on the U.S. economy will be released until partial shutdown of the U.S. economy revokes. The United States is facing partial government shutdown for last 17 days owing to disagreement between President Donald Trump and Democratic lawmakers over funding for a U.S.-Mexico border wall.
Baxter International Inc. BAX recently announced the enrollment of the first group of patients under a U.S. clinical trial for the company’s flagship peritoneal dialysis (PD) solution generation system. ( Read More )
Abiomed, Inc. ABMD recently announced preliminary results for third-quarter fiscal 2019, wherein the top line surpassed the Zacks Consensus Estimate. ( Read More )
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