US stocks have surged on expectations of a de-escalation in trade tensions after Washington and Beijing agreed to hold high-level talks next month, while strong US economic data eased fears of a domestic slowdown.
After anxiety about a deepening trade war triggered a sell-off in late July and early August, leading to speculation that a decade-long bull market was ending, the S&P 500 has largely recovered and is now less than 2 per cent short of its 26 July record high close. The benchmark index has climbed 2.4 per cent in the past two sessions. China and the US agreed to hold talks in early October in Washington, boosting markets as investors bet on a thaw in the trade war between the world’s two largest economies, which has taken a toll on global growth.
Alternating signs of improvement and deterioration in the US-China trade war, often based on tweets and comments from US President Donald Trump, have repeatedly sparked volatility on Wall Street in recent months. The S&P information technology index rose 2.1 per cent while financials jumped 1.9 per cent, the two rising the most among the 11 major S&P 500 sectors.Morning-Market-Note-Friday-6th-September