Wall Street enters third day of gains as trade fears ease
(Reuters) - U.S. stocks rose on Monday, with bank stocks leading third day of gains in a row after strong U.S. jobs data from last week helped investors brush aside trade concerns.
The S&P financial index rose 1.3 percent, providing the biggest boost to the main S&P index. But gains were widespread, with technology, energy, industrials, consumer discretionary and healthcare stocks rising.
The United States and China engaged in tit-for-tat tariffs on Friday, both countries imposing duties worth $34 billion on each others’ goods. But the benchmark S&P 500 closed up 0.84 percent on Friday as many analysts said the move was already priced in, but warned that further escalation could dent the appetite for stocks.
China’s securities regulator said on Sunday it plans to ease restrictions on foreign investment in stocks listed on the Shanghai or Shenzhen exchanges to attract more foreign capital and support the economy.
The sentiment was largely upbeat after Friday’s U.S. payrolls report showed tame wages and more people looking for work, boosting optimism that the Federal Reserve would stay on a path of gradual interest rate increases.
“Last Friday’s gains managed to put a positive patina on what was otherwise a rather unimpressive week for equity investors,” Peter Kenney, senior market strategist at Global Markets Advisory Group in New York, wrote in a note.
“That tone could serve investors well this week as we launch into Q2 earnings season.”
At 9:49 a.m. ET the Dow Jones Industrial Average was up 193.11 points, or 0.79 percent, at 24,649.59, the S&P 500 was up 15.33 points, or 0.56 percent, at 2,775.15 and the Nasdaq Composite was up 46.97 points, or 0.61 percent, at 7,735.36.
All eyes will turn to second-quarter earnings reports, with banks JPMorgan, Wells Fargo and Citigroup scheduled to report on Friday.
S&P 500 companies are expected to report 21 percent growth in earnings per share for the June quarter, according to Thomson Reuters I/B/E/S. But focus will be on any warnings companies might give about the impact of trade tariffs.
U.S.-listed shares of Chinese companies Alibaba, JD.com and Baidu climbed after KeyBanc recommendations on the stocks.
Tesla was up 1.6 percent after automotive news website Electrek reported the company hiked prices of its Model X and S cars by over $20,000 in China due to tariffs.
Groupon jumped 8.8 percent after a Recode report that the daily deals website operator was looking for a buyer.
Advancing issues outnumbered decliners for a 2.53-to-1 ratio on the NYSE and a 2.16-to-1 ratio on the Nasdaq.
The S&P index recorded 17 new 52-week highs and no new lows, while the Nasdaq recorded 97 new highs and six new lows.
Reporting by Sruthi Shankar in Bengaluru; Editing by Shounak Dasgupta