US-China trade deal hopes lift stocks on Wall Street

Stocks moved higher on Wall Street in afternoon trading Friday, placing the major indexes on track for record highs.

Investors were encouraged after U.S. officials said they were making progress in the latest push for a trade agreement with China.

The market has been sensitive to any developments on U.S.-China trade talks. Investors hope the world’s two biggest economies can make a deal before new and more damaging tariffs take effect next month.

Technology stocks were the biggest winners. Companies in the sector are particularly sensitive to swings in trade sentiment because many of them rely on China for sales and supply chains. Applied Materials surged 9.1% on solid earnings.

Health care and industrial companies were also making strong gains. Biogen rose 2.1% and Caterpillar gained 1.3%.

Bond prices fell, pushing yields higher, a signal that investors were shifting away from safe-play holdings. The yield on the 10-year Treasury rose to 1.83% from 1.81% late Thursday.

Utilities stocks and makers of household goods lagged the market.

Published reports suggested earlier this week that negotiations between the world’s two largest economies had hit some snags. Beijing is pressing Washington to roll back tariffs as part of a potential deal that the nations are trying to hammer out.

On Friday, Commerce Secretary Wilbur Ross told Fox Business that it is likely a trade deal will get done, though he noted that it’s still possible a pact could unravel at the last minute as it did in when both sides got close to a deal in May.

KEEPING SCORE: The S&P 500 index was up 0.5% as of 1:46 p.m. Eastern time. The Dow Jones Industrial Average gained 134 points, or 0.5%, to 27,916. The Nasdaq rose 0.6%. The Russell 2000 index of smaller companies added 0.5%.

Asian and European markets moved higher.

SLOW AND STEADY: The S&P 500 is headed for a sixth straight weekly gain. The index has set records and extended its streak during a week of mostly listless trading. It’s on track to top its record close of 3,096.63 from Thursday.

The Dow is on track for its fourth week of gains. It is poised to beat its record close of 27,783.59, which it set on Wednesday.

The Nasdaq could also potentially beat its record of 8,486.09, which it set on Tuesday.

BUFFETT BUMP: Luxury retailer RH climbed 8.2% and energy company Occidental Petroleum gained 2.9% after Warren Buffett’s company disclosed that it had picked up shares of both companies.

BIG FISH: Amarin jumped 10% after a government advisory panel recommended broader use of its fish oil-based heart disease drug Vascepa. Financial analysts predict that broader use of the drug could translate into billions in sales.

DRESSED FOR SUCCESS: J.C. Penney vaulted 9.1% after the struggling department store chain reported a smaller quarterly loss and raised its annual profit forecast.


AP Business Writer Damian J. Troise contributed.

Alex Veiga, The Associated Press