S&P 500 rallies 1% to notch first close ever above 6,800 on potential China trade truce
Stocks jumped to new records on Monday after U.S. and China officials cooled tensions over the weekend, laying the groundwork for President Donald Trump and China President Xi Jinping to clinch a trade deal this week.
The S&P 500 climbed 1.23% to 6,875.16, its first close ever above the 6,800 level, while the Nasdaq Composite rallied 1.86% to 23,637.46, bolstered by a rise in Nvidia and other chip stocks. The Dow Jones Industrial Average jumped 337.47 points, or 0.71% to 47,544.59. All three of the major averages closed at record highs, along with the Russell 2000 small-cap benchmark.
“I think we have a very successful framework for the leaders to discuss on Thursday,” said Treasury Secretary Scott Bessent from the ASEAN Summit in Kuala Lumpur, Malaysia.
The framework potentially includes a delay of China’s rare earth export restrictions that caused the latest trade flare-up, the withdrawal of Trump’s threatened 100% tariffs on China that were set to start Nov. 1 and a resumption of Chinese purchases of American soybeans. The agreement may also include a resolution of the TikTok dispute, with the U.S. getting a deal for the domestic version of the social video app.
“I have a lot of respect for President Xi, and we are going to come away with the deal,” Trump said on Monday from Air Force One.
Chipmakers, the sector with the most to lose from tensions with China, supported the rally Monday. Nvidia as well as others such as Broadcom rose more than 2%. Tesla jumped 4.3%.
Qualcomm moved up 11% and had reached a new all-time high earlier in the trading day after the company announced new artificial intelligence chips, a move that puts it in competition with Nvidia and AMD.
Source : Cnbc.com
