Stocks notched broad gains Wednesday on Wall Street as investors regained some of their optimism about the prospects for progress in the trade war between the U.S. and China.
A day after escalating trade tensions led to a sharp sell-off, investors drew encouragement from reports that Beijing signaled it is open to a partial deal. Washington and Beijing are scheduled to begin a 13th round of trade negotiations today.
Technology stocks led the rally, which erased some of the market’s sharp losses from the day before and snapped a two-day losing streak for the S&P 500. The benchmark index is still on track to end the week with a 1.1% loss.
“Whichever way the trade winds tend to be blowing is the way the market tends to direct itself,” said Sam Stovall, chief investment strategist, CFRA. “Yesterday it was a worry that we would not really have any kind of success coming out of the upcoming trade talks. Now it sounds as if China would be willing to engage in some piecemeal accords.”
The S&P 500 rose 26.34 points, or 0.9%, to 2,919.40. The Dow Jones Industrial Average gained 181.97 points, or 0.7%, to 26,346.01. The Nasdaq picked up 79.96 points, or 1%, to 7,903.74. The Russell 2000 index of smaller company stocks added 6.86 points, or 0.5%, to 1,479.46.
Bond yields rose, reflecting the move by investors to shift into higher-risk assets. The yield on the 10-year Treasury increased to 1.58% from 1.53% late Tuesday.
Technology sector stocks led the gains Wednesday. The sector has been suffering most of the week because of uncertainty over the talks. Many of the companies rely on China for revenue and their supply chains. Microsoft rose 1.9% and Apple added 1.2%.
Benchmark crude oil fell 4 cents to settle at $52.59 a barrel. Brent crude oil rose 8 cents to close at $58.32 a barrel.