US close: Markets eke out gains on loosening of trade war tensions
Wall Street managed to eke out minor gains on Tuesday after news from discussions between North and South Korea - reported to include plans for the first major summit between the two in over a decade - pointed to a de-escalation of tensions and the easing of one of the market's biggest geopolitical uncertainties.
Dow Jones I.A.
38,085.80
04:30 15/10/20
Nasdaq 100
17,430.50
12:15 25/04/24
The Dow Jones Industrial Average ended the day 0.04% above the waterline at 24,884.12, the S&P 500 was ahead 0.26% at 2,728.12, and the Nasdaq 100 finished 0.46% higher at 6,913.02.
“Investors may have been rattled by the prospect of a trade war after Donald Trump’s recent tariffs announcement, but equity markets are once again recovering as it becomes clear that the US President does not have the full backing of his party of this one,” noted Craig Erlam, senior market analyst at Oanda.
“Some Republicans, including House Speaker Paul Ryan, have warned against starting a trade war that could damage the economy and undo the benefits of the recently passed tax reforms, highlighting that Trump is lacking the full support of his party on this particular issue.
“Trump’s comments linking the tariffs to NAFTA negotiations also suggested that they could be dropped if a new agreement is signed, suggesting he may simply be using the threat of tariffs to put pressure on others to deliver what he considers to be fair and reciprocal trade.”
In terms of economic data, new orders for manufactured goods saw their largest drop in six months in January as business spending on equipment appeared to be reducing after strong growth in 2017, according to the Commerce Department's factory orders report.
Factory goods orders fell 1.4% in the month following five straight monthly increases. January's drop was broadly in line with economists' expectations.
Orders picked up 8.4% on a year-on-year basis.
On the corporate front, shares of Ciena Corp gained 10.11% after its quarterly earnings beat expectations, but Target lost 4.45% after the ‘cheap-chic’ discount department store’s fourth-quarter profit missed analysts' forecasts.
Deep discounter Dollar Tree finished ahead 1.68%, wine and spirits producer Brown-Forman was down 0.85% and membership warehouse retailer Costco slipped 0.01% - all three companies are due to report earnings before markets open on Wednesday.