A pedestrian is reflected in an electronic stock board outside a securities firm in Tokyo, Japan. (Photographer: Noriko Hayashi/Bloomberg)

Stocks Rise as Trump Shakes Up Trade Landscape: Markets Wrap

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(Bloomberg) -- U.S. stocks gained and Treasuries retreated as President Donald Trump said he’s considering rejoining the Trans-Pacific Partnership trade deal he pulled out of shortly after taking office. Crude added to this week’s climb, and the dollar rose.

The S&P 500 Index was up roughly 0.8 percent and the Dow Jones Industrial Average added almost 300 points, or 1.2 percent, as investors assessed the changing trade dynamics. Trump also said that a decision on any military retaliation in Syria will come “fairly soon,” one day after he tweeted a warning to “get ready” for a missile attack.

“The tone of what was coming out of the White House, the tweet from the president yesterday, was cause for concern and creates a risk-off kind of a feeling,” said Tom Wright, director of equities at JMP Securities. “And then today you get a much different kind of a message, and so we have a pretty broad based rally across all sectors.”

In addition, Trump defused some of the trade war chatter with China, saying that the two countries may not end up levying new tariffs on each other following conciliatory remarks on Tuesday by Chinese President Xi Jinping.

Banks and finance firms were among the biggest gainers after asset management giant BlackRock Inc. reported first-quarter earnings that topped analysts’ estimates. JPMorgan Chase & Co. and Citigroup Inc. are scheduled to release theirs on Friday.

“It’ll be nice in a way to hopefully focus a little bit more on company fundamentals for a period of time,” Wright said.

Investors also are weighing minutes from the most recent Federal Reserve meeting, which showed officials leaning toward a slightly faster pace of policy tightening.

“It’s very clear from (Fed Chairman) Jerome Powell’s comments, that it would take a lot more damage to the stock market for the Fed to factor that in as a reason to slow down the pace of rate hikes,” said Quincy Krosby, chief market strategist at Prudential Financial Inc. “He’s made it very clear that the market participants should not expect the Fed to come to the immediate rescue of a market that is volatile.”

The euro fell after a report that European industrial output unexpectedly declined for a third consecutive month. Government bonds of most euro-region countries rose after minutes of the latest policy meeting of the European Central Bank struck a dovish tone.

Terminal users can read more in our markets live blog.

Here are the main moves in markets:

Stocks

  • The S&P 500 climbed 0.8 percent to 2,663.99, while the Nasdaq 100 Index rose 1.1 percent.
  • The Stoxx Europe 600 Index advanced 0.7 percent.
  • The MSCI All-Country World Index added 0.4 percent.
  • The MSCI Emerging Market Index was little changed.
  • The MSCI Asia Pacific Index decreased 0.5 percent.

Currencies

  • The Bloomberg Dollar Spot Index increased 0.1 percent, the first advance in a week.
  • The euro sank 0.3 percent to $1.2325, the largest decrease in more than two weeks.
  • The British pound rose 0.4 percent to $1.4226 on its fifth consecutive advance.
  • The Japanese yen fell 0.4 percent to 107.25 per dollar, the weakest in a week.

Bonds

  • The yield on 10-year Treasuries increased five basis points to 2.8321 percent.
  • Germany’s 10-year yield climbed two basis points to 0.515 percent.
  • Britain’s 10-year yield gained seven basis points to 1.456 percent, the highest in three weeks.

Commodities

  • West Texas Intermediate crude rose 0.5 percent to $67.12 a barrel.
  • Copper decreased 1.8 percent to $3.06 a pound.
  • Gold sank 1.3 percent to $1,335.41 an ounce.

©2018 Bloomberg L.P.

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