U.S. Stocks Move Modestly Higher On Chinese Tariffs Exemptions
(RTTNews) - After closing mixed for three consecutive sessions, stocks have moved modestly higher in morning trading on Wednesday. The major averages have all moved to the upside, although buying interest has remained somewhat subdued.
Currently, the major averages are hovering in positive territory. The Dow is up 50.78 points or 0.2 percent at 26,960.21, the Nasdaq is up 48.50 points or 0.6 percent at 8,132.65 and the S&P 500 is up 7.65 points or 0.3 percent at 2,987.04.
The strength on Wall Street partly reflects a positive reaction to news that China is granting tariff exemptions for 16 types of American-made products as a sign of goodwill ahead of the next round of trade talks.
The list included varieties of animal feed such as alfalfa and fish meal, cancer drugs gefitinib and capecitabine, base oil for lubricants and lubricating grease, and some farm chemicals.
The Chinese Customs Tariff Commission said the tariff suspension would take effect next Tuesday and remain in place for a year.
Overall trading activity remains relatively light, however, as traders look ahead to the European Central Bank's monetary policy decision on Thursday as well as next week's Federal Reserve meeting.
In a post on Twitter this morning, President Donald Trump urged the Fed to lowest interest rates to zero or less, allowing the U.S. to refinance its debt.
"INTEREST COST COULD BE BROUGHT WAY DOWN, while at the same time substantially lengthening the term. We have the great currency, power, and balance sheet," Trump tweeted.
"The USA should always be paying the lowest rate. No Inflation!" he added. "It is only the naïveté of Jay Powell and the Federal Reserve that doesn't allow us to do what other countries are already doing. A once in a lifetime opportunity that we are missing because of 'Boneheads.'"
On the U.S. economic front, the Labor Department released a report showing a modest uptick in producer prices in the month of August.
The Labor Department said its producer price index for final demand inched up by 0.1 percent in August after rising by 0.2 percent in July. Economists had expected prices to come in unchanged.
Excluding food and energy prices, core producer prices rose by 0.3 percent in August after edging down by 0.1 percent in July. Core prices had been expected to increase by 0.2 percent.
Natural gas stocks have shown a significant move to the upside in morning trading, driving the NYSE Arca Natural Gas Index up by 2.3 percent to its best intraday level in over a month.
The rally by natural gas stocks comes despite a modest decrease by the price of the commodity, as natural gas for October delivery is slipping $0.003 to $2.577 per million BTUs.
Tobacco, gold, and oil stocks are also seeing notable strength on the day, moving higher along with most of the other major sectors.
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher on Wednesday, although Chinese stocks bucked the uptrend. Japan's Nikkei 225 Index jumped by 1 percent, while Hong Kong's Hang Seng Index surged up by 1.8 percent.
The major European markets have also moved to the upside on the day. While the U.K.'s FTSE 100 Index has surged up by 1.1 percent, German DAX Index is up by 0.8 percent and the French CAC 40 Index is up by 0.5 percent.
In the bond market, treasuries are extending the downward trend seen over the past several sessions. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 2.3 basis points at 1.725 percent.