S&P 500 hits record high on trade optimism

Daniel Fowler
July 1, 2019

The benchmark index surpassed its previous record high of 2,964.15 hit on June 21.

At the close in Tokyo, the rose 2.13% to hit a new 1-month high.

Gains in technology stocks lifted the S&P 500 to a record high today, powered by growing optimism around US-China trade talks and a likely reprieve for Chinese telecoms company Huawei.

"And investors at this point are trying to focus on the positive in hopes that there will be some trade resolution down the line".

The blue-chip Swiss index .SSMI gained 0.7% despite stocks being blocked from trading on European Union exchanges after talks to resolve a dispute between Brussels and Switzerland collapsed.

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However, expectations of a more accommodative Federal Reserve helped the S&P 500 and the Dow Jones Industrial Average index post their best June performance in generations. Co., Ltd. (T:) added 8.62% or 387.5 points to end at 4882.5 and TDK Corp (T:) was up 6.95% or 580.0 points to 8920.0 in late trade. While an immediate deterioration in US-China relations has been averted, for now at least, the tariffs already imposed on global trade are still in effect and are expected to continue weighing on global growth.

Tech stocks, which are Wall Street's top performers so far in 2019, jumped 1.80 per cent, with heavyweight Apple Inc's 2.9 per cent gain providing the maximum support. Shares of Microsoft Corp (MSFT.O), Alphabet Inc (GOOGL.O), (NFLX.O) and Amazon.com Inc (AMZN.O) also boosted the tech-heavy index.

Following a meeting on the sidelines of the Group of Twenty (G-20) summit over the weekend, President Trump and President Xi confirmed that they do not intend to levy any new tariffs against each other's products at present, while Trump suggested a reversal of his administration's decision to ban American companies from selling products to Chinese telecommunications giant Huawei. Meanwhile, safe haven assets are losing ground on the ebbing risk aversion, with Gold falling below the psychological $1400 level, while the Japanese Yen weakened by some 0.3 percent to go back above the 108 level versus the Greenback. The index opened 1.1% higher.

Crude oil rises 2.3% to $59.84 per barrel after OPEC+ oil supply cut deal is extended by six to nine months.

Advancing issues outnumbered decliners by a 2.19-to-1 ratio on the NYSE and by a 1.88-to-1 ratio on the Nasdaq.

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