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Stocks -- Trade Deal Sends Wall Street Soaring

Stock MarketsOct 11, 2019 05:34PM ET
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Investing.com - Stocks finished at their highest levels in about two weeks as President Donald Trump touted a "substantial phase one deal" that resolves some of the trade disputes between the United States and China.

The trade deal includes scrapping imposition of tariffs on Chinese imports due next week and a Chinese pledge to buy more farm products.

The rally was very broad and saw the Dow Jones industrials climb more than 517 points before a strong wave of profit-taking set in and cut the gain by 38% to about 320 points. Apple (NASDAQ:AAPL) hit a new intraday high of $237.63, accompanied by a host of big stocks.

The S&P 500 finished up 1.09% but failed for a 16th day to close above 3,000.

The Nasdaq Composite climbed about 1.34%, or 106 points, closing above 8,000 for the first time since Sept. 26.

The Nasdaq 100, dominated by big tech stocks, added 1.34% or nearly 104 points, with Apple, up 2.7%, adding 23 points to the gain by itself.

In addition, Apple, plus Facebook (NASDAQ:FB), Amazon.com (NASDAQ:AMZN), Comcast (NASDAQ:CMCSA), Intel (NASDAQ:INTC) and Microsoft (NASDAQ:MSFT) contributed a total of 48.6 points to the Nasdaq-100's gain.

The size of the selloff was biggest in the last 25 minutes of trading. It could be that some investors (or the computer algorithms that guide their trading) were put off by Trump's use of the phrase Phase 1, suggesting that there's much more to negotiate and much more that's contentious. The biggest would be technology theft.

It could also be the classic idea of "buy the hype and sell the news" came into play. Markets waited all day for an announcement, and there was enough uncertainty left over to set off the selling.

The {0|Dow}} was led by stocks with overseas exposure that would benefit by a thaw in U.S.-Chinese intensions: Caterpillar (NYSE:CAT), chemical giant Dow Inc (NYSE:DOW), 3M (NYSE:MMM) and Apple (NASDAQ:AAPL). Only four Dow stocks were lower, with McDonald’s (NYSE:MCD) the laggard.

Only six Nasdaq 100 stocks were lower. The leader for the day was Fastenal Company (NASDAQ:FAST), maker of fasteners and vending machines used in industrial settings. The company reported a huge earnings beat. The shares jumped more than 17%, its second-best percentage gain since going public in 1987.

Fastenal, Freeport-McMoran Copper & Gold (NYSE:FCX), fertilizer maker Mosaic (NYSE:MOS) and Wynn Resorts (NASDAQ:WYNN) were the top S&P 500 performers. The latter three especially would benefit from the projected U.S.-China trade deal.

The S&P 500 biggest laggards include California utility giant Edison International (NYSE:EIX), gold producer Newmont Goldcorp (NYSE:NEM), market-platform operator MarketAxess Holdings (NASDAQ:MKTX) and Church & Dwight Company (NYSE:CHD), whose products include Arm & Hammer baking soda.

Interest rates rose as investors sold bonds to move to riskier assets. The 10-Year Treasury yield moved up to 1,767% from Thursday's 1.656%.

Oil prices moved more than 2% higher, in part because of the progress of the trade talks, which would be a boon to global growth. Prices also moved up on reports of an attack on an Iranian oil tanker.

Stocks -- Trade Deal Sends Wall Street Soaring
 

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brad merck
brad merck Oct 12, 2019 8:12AM ET
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Fake , friday at the last the future ya 500 down , and gold up, 1500 monday and 1520 coming
Jonathan Snell
Jonathan Snell Oct 12, 2019 6:41AM ET
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what to see what the Chinese state media reports...wink.
Jon Bal
Jon Bal Oct 12, 2019 6:41AM ET
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funny an true...when you go to a .cn news site they're like "ummmm..huh?"
Chris Sundo
Chris Sundo Oct 12, 2019 6:31AM ET
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"...President Donald Trump touted a "substantial phase one deal" that >>resolves<< some of the trade disputes between the United States and China..." --- that's enormous, if true. ---- Are we allowed to cry "Wolf ! " after his last 12 months' history?
Rob Hunter
Rob Hunter Oct 12, 2019 12:09AM ET
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Trade deal? Perhaps more stalling. We will know within 5 weeks or so
emerick giberne
cake40 Oct 11, 2019 11:50PM ET
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Mind the GAP on Monday !
Darlington Anikwenwa
Darlington Anikwenwa Oct 11, 2019 11:50PM ET
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up or down?
Mik Jiiii
Mik Jiiii Oct 11, 2019 11:50PM ET
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Joe Crea
Joe Crea Oct 11, 2019 10:33PM ET
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That is quite a take on today's action. Algos and profit taking? More like rapid selling after realization that there was no real progress towards a trade deal.
Erski Gumby
SB20 Oct 11, 2019 10:33PM ET
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I hope you made money during the last 15 minutes before the market closed.
eddie glass
eddie glass Oct 11, 2019 9:11PM ET
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with a headline like this, expect a 1000 point drop over the next week
Erski Gumby
SB20 Oct 11, 2019 9:11PM ET
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That’s the goal.
Deepak Mehta
DMEHTA Oct 11, 2019 8:37PM ET
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The gains were from futures only . The cash market gave all gains back to 0. Almost all rallies for past few months are on futures and short covering that tells the market quality and fundamentals. The junkies are hyping to sell
Erski Gumby
SB20 Oct 11, 2019 8:37PM ET
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Futures only?
Patrick Mueller
Patrick Mueller Oct 11, 2019 7:21PM ET
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Phase 12 October 2020, Phase 36 Ocrober 2022 #dead
Joseph Lee
Joseph Lee Oct 11, 2019 7:21PM ET
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This is hilarious!!!
Andreas Papadopoulos
Andreas Papadopoulos Oct 11, 2019 6:53PM ET
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Phase 1 starts on Monday...and continues all week...down
Logan Keith
Logan Keith Oct 11, 2019 6:45PM ET
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"deals"
indra Setiawan
indra Setiawan Oct 11, 2019 5:24PM ET
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fake news trump! we"ve known it on early stage. we know you. we are sick of you as the godfather of WORLD market player. you better get dumped soon from white house. it waste of time lives there too long for you
Erski Gumby
SB20 Oct 11, 2019 5:24PM ET
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Wow! Can you rephrase that please?
King Pin
kingpin22 Oct 11, 2019 4:56PM ET
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Actually once the terms of the deal started coming out, the market went back down and finished at least .75% off the highs. Talk about fake news.
Luis Serrano
Luis Serrano Oct 11, 2019 4:20PM ET
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didn't trump say he expected a full deal? this deal looks skinny to me
Andrew Hook
Andrew Hook Oct 11, 2019 4:20PM ET
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tiny like is hand ;)
brad merck
brad merck Oct 11, 2019 4:14PM ET
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fake , where ?? lol down
 
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