Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S. (Photographer: Michael Nagle/Bloomberg)

Stocks Rebound as Trade Comments Ease Concerns: Markets Wrap

(Bloomberg) --

U.S. stocks rebounded as President Donald Trump moved to reassure markets that he’ll clinch a trade deal with China. The dollar rose and Treasuries fell.

The S&P 500 rose for the second time in three sessions after Trump said he’s talking with China. The benchmark is still down around 4% since the president escalated the trade war on May 5, and Tuesday’s rally faded into the close. Battered tech shares led the advance as Apple Inc. and Nvidia Corp. bounced back from their biggest one-day declines since January. Heavyweight exporters Caterpillar Inc. and Boeing Co. also reversed a portion of Monday’s losses.

The dollar advanced for a second day against major peers, including havens such as the Japanese yen and the Swiss franc. The offshore yuan -- a key risk indicator due to concern China will use it to retaliate against U.S. tariffs -- stabilized after a six-day decline. Ten-year Treasury yields edged higher to 2.41%. Commodities targeted by Chinese tariffs -- including soybean and cotton futures -- also rebounded. West Texas crude rose above $61 a barrel.

Stocks Rebound as Trade Comments Ease Concerns: Markets Wrap

“Investors are looking for opportunities to get into this market, and so far in 2019 there really haven’t been any ‘buy the dip’ opportunities other than last week,” Ryan Nauman, market strategist at Informa Financial Intelligence, said by phone. “And you’re also seeing President Trump confirmed a meeting with President Xi during next month’s G-20 summit, which provides some optimism that despite the increase in tariffs, negotiations are still ongoing.”

Signs emerged Tuesday Trump had pressed the trade battle far enough. The president sprinkled his criticisms of China over the last 48 hours with enough signals that negotiations haven’t completely broken down that traders rushed back into the beaten down market to find bargains. But the rally remains tenuous as the White House announced it was prepping tariffs on the remaining $300 billion of Chinese imports, and economists warned the new penalties will eventually weigh heavily on the American economy.

Here are some notable events coming up this week:

  • Earnings this week include Alibaba, Tencent, Cisco, Nvidia.
  • Kansas City Fed President Esther George and Richmond Fed President Thomas Barkin make appearances.
  • China industrial production and retail sales are slated for Wednesday, the same day as U.S. retail sales and industrial production.
  • Bank of Indonesia has an interest rate decision on Thursday.
  • Australian unemployment is out on Thursday.

And here are the main market moves:

Stocks

  • The S&P 500 Index rose 0.8% as of 4 p.m. New York time.
  • The Nasdaq Composite Index advanced 1.3%, while the Dow Jones Industrial Average added 0.9%.
  • The Stoxx Europe 600 Index gained 1%.
  • The MSCI Emerging Market Index decreased 0.2%.
  • The MSCI Asia Pacific Index sank 0.8%.

Currencies

  • The Bloomberg Dollar Spot Index gained 0.2% to the highest in more than a week.
  • The euro fell 0.1% to $1.1214.
  • The British pound dipped 0.2% to $1.2927.
  • The Japanese yen decreased 0.3% to 109.66 per dollar.

Bonds

  • The yield on 10-year Treasuries rose one basis point to 2.41%.
  • Germany’s 10-year yield was unchanged at -0.07%.
  • Britain’s 10-year yield was little changed at 1.105%.

Commodities

  • West Texas Intermediate crude climbed 1.1% to $61.70 a barrel.
  • Gold fell 0.3% to $1,297.70 an ounce.

©2019 Bloomberg L.P.