Stock rose on Wednesday as investors cheered a nearing trade deal between the U.S. and China though softer measures on payrolls and the service economy kept a lid on optimism.
The Dow Jones Industrial Average rose 10 points as UnitedHealth and Home Depot outperformed. The S&P 500 gained 0.25 percent, led by materials and technology stocks. The Nasdaq Composite advanced 0.5 percent.
American and Chinese officials are reportedly closing in on a trade deal, having resolved most of the outstanding issues in their protracted trade dispute. Both countries have levied tariffs on billions of dollars' worth of each other's goods since last year.
According to the Financial Times, Beijing wants Washington to remove existing U.S. duties on Chinese imports, while the Trump administration wants China to agree to enforcement measures that ensure the country sticks to the deal.
U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin are scheduled to meet with Chinese Vice Premier Liu He later on Wednesday to resume talks.
European stocks rose broadly as the Stoxx 600 index gained 0.8 percent. In Asia, the Shanghai Composite surged 1.2 percent, while the Japanese and Korean Kospi indexes both rose around 1 percent.
"To a certain degree, a trade deal is already priced in," said Peter Cardillo, chief market economist at Spartan Capital Securities. However, "a trade deal is a win for the United States and the global economy."
"That will lift a major cloud that's over the global economy," he said.
This comes after a rocky previous session for Wall Street. The Dow fell for the first time in four sessions Tuesday, pulling back from a solid rally at the start of the week.
Gains were capped, however, by weaker-than-expected economic data.
Private payrolls increased by 129000 in March, according to ADP and Moody's Analytics. That is well below a Refinitiv estimate of 173,000. The report from ADP and Moody's is typically seen as a preview for the U.S. government's monthly jobs report, which is scheduled for release Friday morning.
A weaker-than-expected update on the U.S. services sector also capped stock advances throughout the session. Growth in services fell more than expected in March and advanced at its slowest pace in more than 12 months, the Institute for Supply Management reported.
The ISM non-manufacturing index dipped to 56.1 last month, its softest read since August 2017.
A bearish call on Caterpillar shares also kept the market in check. Caterpillar shares fell 1 percent after Deutsche Bank downgraded the industrial giant to hold from buy and slashed its 12-month price target. The bank cited a "collapse" in synchronized global growth.
—CNBC's Ryan Browne contributed to this report.
https://www.cnbc.com/2019/04/03/stock-market-futures-rise-on-hopes-us-china-are-close-to-trade-deal.html
2019-04-03 14:17:28Z
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