Stocks Climb On Report U.S. May Pare Back Tariffs On China

U.S. stocks climbed Thursday after The Wall Street Journal reported that U.S. officials could reduce the new tariffs on Chinese imports as part of trade negotiations between the two countries.

Citing sources close to the discussions, the Journal said Treasury Secretary Steven Mnuchin and other officials are willing to lift some or all of the import taxes the U.S. announced last year. They’re aiming to convince Chinese leaders to make deeper reforms. However, U.S. Trade Representative Robert Lighthizer reportedly doesn’t support the idea.

The S&P 500 index rose 19.86 points, or 0.8 percent, to 2,635.96. The Dow Jones Industrial Average jumped as much as 267 points following the report about the potential tariff cuts. It finished with a gain of 162.94 points, or 0.7 percent, at 24,370.10. The Nasdaq composite added 49.77 points, or 0.7 percent, to 7,084.46. The Russell 2000 index of smaller-company stocks climbed 12.55 points, or 0.9 percent, to 1,467.25.

Among tech companies, chipmaker Nvidia gained 1.9 percent to $151.72 and Advanced Micro Devices rose 2.6 percent to $20.25. Hard drive makers struggled, however. Western Digital lost 3.6 percent to $36.47 and Seagate shed 2.5 percent to $38.73 as digital storage companies sank.

Industrial companies also stand to benefit from greater trade and faster economic growth. Defense contractors made strong gains after President Donald Trump called for a space-based missile defense system following a strategy review by the Pentagon.

Defense contractor Northrop Grumman gained 3.3 percent to $264.08 and Lockheed Martin rose 2.4 percent to $278.80. Aerospace company Boeing advanced 2 percent to $359.09.

Elsewhere Fastenal, which makes industrial and construction fasteners, jumped 5.9 percent to $57.34 after it said customers became a bit less cautious about spending in December.

Among health care companies, drugmaker AbbVie added 1.9 percent to $87.20 and medical device maker Becton Dickinson picked up 2.1 percent to $236.11 after it said it had a strong fiscal first quarter.

All 11 S&P 500 sectors finished higher, but internet and communications companies, household goods makers and utilities lagged the rest of the market. Netflix rose 0.5 percent to $353.19, but after the close of trading its stock fell 3.2 percent after its fourth-quarter revenue and its first-quarter revenue forecast both came up short of analysts’ expecations.

Bond prices edged lower. The yield on the 10-year Treasury note increased to 2.75 percent from 2.73 percent.

Benchmark U.S. crude oil fell 0.5 percent to $52.41 a barrel in New York, while Brent crude, the international standard, gave up 0.2 percent to $61.18 a barrel in London.

Wholesale gasoline rose 1 percent to $1.43 a gallon and natural gas added 0.9 percent to $3.41 per 1,000 cubic feet. Heating oil slid 0.5 percent to $1.88 a gallon.

Gold dipped 0.1 percent to $1,292.30 an ounce and silver lost 0.7 percent to $15.54 an ounce. Copper added 0.2 percent to $2.68 a pound.

The dollar rose to 109.23 yen from 108.92 yen. The euro slipped to $1.1390 from $1.1398. The British FTSE slipped 0.4 percent and the CAC 40 of France fell 0.3 percent. Germany’s DAX dipped 0.1 percent.