The S&P 500 has ended the day down slightly but less than 1 per cent below its all-time high as a drop in Apple stock countered cooling US-China trade tensions. Tariff-vulnerable industrials helped keep the blue-chip Dow in positive territory, which has now gained in eight straight sessions, its longest winning streak since May 2018.

All three major US stock indexes posted their third straight weekly gains, capping a week that saw signs of a potential thaw in the trade war between the world’s two largest economies, which has gripped markets for months. Beijing announced it would exempt some US agricultural products from additional tariffs after President Donald Trump suggested he could be open to an interim deal, the latest conciliatory gestures by both sides of the trade war ahead of next month’s negotiations in Washington. However, rising Treasury yields did boost interest-rate sensitive financials, which gained 0.8 per cent.

On the economic front, US retail sales increased in August at twice the rate analysts expected, according to the Commerce Department, suggesting that strong consumer spending will continue to support the longest-ever US economic expansion. Ebbing trade jitters and upbeat retail sales data helped US Treasury yields reach multi-week highs, providing an attractive alternative to risk-averse investors.

Market participants now look to the US Federal Reserve, which is widely expected to cut interest rates by 25 basis points at the conclusion of its monetary policy meeting next week. The Dow Jones Industrial Average on Friday rose 37.07 points, or 0.14 per cent, to 27,219.52; the S&P 500 lost 2.18 points, or 0.07 per cent, to 3,007.39; and the Nasdaq Composite dropped 17.75 points, or 0.22 per cent, to 8,176.71.

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