US STOCKS-Wall Street rises as industrials, tech bounce on trade truce
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* U.S., China agree on a 90-day trade ceasefire for talks
* Technology, industrials sectors biggest boost to S&P
* Carmakers gain as Trump says China to cut import tariffs
* Amazon market cap briefly overtakes Apple
* Indexes up: Dow 0.87 pct, S&P 0.78 pct, Nasdaq 1.16 pct (Adds comments, updates prices to early afternoon)
By Shreyashi Sanyal
Dec 3 (Reuters) – Trade-sensitive industrial and technology stocks pushed Wall Street higher on Monday after the United States and China agreed on a temporary trade detente, hopes of which had driven the market last week to post its biggest gain in nearly seven years.
Washington and Beijing agreed to a 90-day trade ceasefire at the G20 summit in Argentina on Saturday and U.S. President Donald Trump said China had agreed to cut import tariffs on American-made cars.
However, the White House also said that the existing 10 percent tariffs on $200 billion worth of Chinese goods would be lifted to 25 percent if no deal was reached within 90 days.
Still, the ceasefire was enough to boost S&P technology up 1.37 percent and industrials 1.21 percent, both sectors that have borne the brunt of the escalating trade dispute.
Apple Inc, recently hit by worries over possible tariffs on iPhones, rose 1.9 percent. Trade bellwethers Caterpillar Inc and Boeing Co were up 2.9 percent and 3.5 percent, respectively.
“When we see industrials and tech leading it would lead us to believe that ‘risk on’ is slowly making its way back, but investors are still cautiously optimistic,” said Michael Antonelli, managing director, institutional sales trading at Robert W. Baird in Milwaukee.
“People are looking at the growth names trying to lead markets again, because they haven’t been torn down completely by the October sell-off and are enjoying a bit of a bounce today.”
Amazon.com Inc jumped 4.3 percent, which briefly helped it overtake Apple in intraday trade to become the most valuable company on Wall Street.
At 12:58 p.m. ET, the Dow Jones Industrial Average was up about 1 percent.
The S&P 500 and the Nasdaq Composite were at their highest in over three weeks. The markets pared some gains from what the futures had indicated in premarket trading.
“We’ve been through tariff talks for a whole year, while it’s reassuring that they’ve decided to come up with a schedule of talks, nothing is written in stone. That’s what is keeping a cap on markets today,” said Kim Forrest, senior portfolio manager at Fort Pitt Capital Group in Pittsburgh.
Energy stocks rose 1.77 percent as crude prices surged on the trade truce and as Canada’s Alberta province ordered a production cut. However, the gains were pared as the rally in oil prices tempered to about 3 percent from about 5 percent at the open.
Trump’s tweet on lower Chinese import taxes sent General Motors Co, Ford Motor Co and Tesla Inc up between 1.8 percent and 3.3 percent.
Chipmakers, which have the highest revenue exposure to China, also rallied, sending the Philadelphia Semiconductor index up 2.24 percent and back into positive territory for the year.
The defensive real estate and consumer staples sectors housed most of the laggards.
Advancing issues outnumbered decliners for a 2.28-to-1 ratio on the NYSE and a 1.50-to-1 ratio on the Nasdaq.
The S&P index recorded 36 new 52-week highs and no new lows, while the Nasdaq recorded 65 new highs and 58 new lows. (Reporting by Shreyashi Sanyal and additional reporting by Amy Caren Daniel in Bengaluru; Editing by Shounak Dasgupta)
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