Stocks were trading off their highs of the day but still holding onto sizable gains after a trade truce between China and the US triggered a 400+ point rally in the Dow at the open. Led by gains in trade-sensitive sectors, the blue chip index is at its highest level in nearly a month, while the S&P 500 trades above its 50-day moving average for the first time since Oct 9.
Buying erupted overnight in Asia and extended across Europe as investors cheered the agreement between the US and China to suspend trade tariffs for 90 days while negotiations resume. Amplified by higher oil prices and a slight improvement in China's Caixin manufacturing index, bourses across Asia and Europe were as much as 2% higher.
Buying continued at a blistering pace premarket until the Dow and S&P 500 ran into resistance at 26,000 and 2,800, respectively, after the cash open. Treasury yields retreated, reflecting the waning euphoria on Wall Street as market participants shifted their focus to the deluge of economic data this week that culminates with November non-farm payrolls.
Economic data released Monday morning was mixed as the final November manufacturing purchasing managers index declined slightly in November, while a corresponding index from the Institute for Supply Management improved. Also, construction spending contracted by 0.1% in October, missing expectations for a 0.4% gain.
In corporate news, automakers were some of Monday's top performing stocks as China will reportedly "reduce and remove" its 40% tax on imported US vehicles, according to a tweet from President Donald Trump. Despite underwhelming November sales, shares of Ford ( F ) are trading at a 10-week high.
Also, Tribune Media Co ( TRCO ) agreed to be acquired by Nexstar Media ( NXST ) for $6.4 billion.
Commodity prices were mixed with gold and silver sharply higher despite the risk rally in equities. Oil futures bounced back on a potential agreement between Saudi Arabia and Russia to stabilize prices through production restrictions. Canada's Alberta province also said it would try to shore up prices with an "unprecedented output cut."
Buoyed by easing trade tensions between the world's two largest economies, and Italy's willingness to lower its deficit/GDP target, European markets were all higher with automakers and industrials driving Germany's DAX to a three-week high.
Crude oil was up $1.44 to $52.37 per barrel. Natural gas was down $0.26 to $4.35 per 1 million BTU. Gold was up $13.40 to $1,239.50 an ounce, while silver was up $0.30 to $14.52 an ounce. Copper was up $0.03 to $2.81 per pound.
Among energy ETFs, the United States Oil Fund was up 3.45% to $11.10 with the United States Natural Gas Fund down 6.67% to $34.83. Among precious-metal funds, the Market Vectors Gold Miners ETF was up 0.81% to 19.25 while SPDR Gold Shares were up 1.00% to $116.70. The iShares Silver Trust was up 1.80% to $13.56.
Here's where the markets stand at mid-day:
NYSE Composite Index was up 70.74 points (+0.58%) to 12,529.74
Dow Jones Industrial Index was up 207.67 points (+0.81%) to 25,746.13
S&P 500 was up 10.56 points (+0.72%) to 2,780.16
Nasdaq Composite Index was up 85.23 points (+1.17%) to 7,416.06
FTSE 100 was up 82.17 points (+1.18%) to 7,062.41
DAX was up 208.22 points (+1.85%) to 11,465.46
CAC 40 was up 50.06 points (+1.00%) to 5,053.98
Nikkei 225 was up 223.70 points (+1.00%) to 22,574.76
Hang Seng Index was up 675.29 points (+2.55%) to 27,182.04
Shanghai China Composite Index was up 66.61 points (+2.57%) to 2,654.80
NYSE SECTOR INDICES
NYSE Energy Sector Index was up 210.91 points (+2.01%) to 10,689.23
NYSE Financial Sector Index was up 36.51 points (+0.47%) to 7,750.96
NYSE Healthcare Sector Index was down 50.34 points (-0.30%) to 16,455.09
(+) AETI (+244.91%) Joint venture BOMAY received a major order for drilling rig control systems
(+) GBT (+49.73%) FDA agreed to allow filing of sickle-cell disease candidate NDA
(+) CYTX (+9.94%) Gets medical device approval in Japan for cell therapy product
(+) TRCO (+10.06%) Agrees to be acquired by Nextar Media for $6.4 billion
(-) HX (-25.11%) Reported a loss for Q2, revenue declines from year ago
(-) TNXP (-21.39%) Filed $34 million stock offering