US STOCKS-Trump talk that U.S.-China trade deal near pushes Wall St higher

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* Trump delays U.S. tariff hike on Chinese goods

* Tariff-exposed industrial, technology shares rise

* Indexes up: Dow 0.52 pct, S&P 500 0.37 pct, Nasdaq 0.56pct (Updates to late afternoon, adds comments, changes byline, AddsNew York dateline)

By Sinéad Carew

NEW YORK, Feb 25 (Reuters) - U.S. stocks rose on Mondayafter President Donald Trump said he would delay a planned hikein tariffs on Chinese imports and that the two countries were"very, very close" to a trade deal.

But Wall Street's three major indexes pulled back fromsession highs as investors waited for new catalysts such as anactual deal with China.

Before the market opened on Monday, Trump said he wasoptimistic a final trade deal could be reached with China butcautioned that an agreement may still not happen. urn:newsml:reuters.com:*:nL1N20K0KM

The U.S. president's move to postpone the tariff deadlinewas seen as the clearest sign yet the two countries were closingin on an agreement to end their prolonged trade spat, which hasslowed global growth and disrupted markets. urn:newsml:reuters.com:*:nL1N20J04S

"The main driver for the market today is renewed optimismregarding a deal between the U.S. and China," said Adam Sarhan,chief executive officer of 50 Park Investments in New York.

But gains were capped after weeks of advances for the S&P500, the Dow Jones Industrial Average and Nasdaq, partly due totrade optimism and dovish signals from the Federal Reserve.

"It would be perfectly normal to see the market pull back alittle to digest the strong move. The market is waiting for thenext bullish catalyst," said Sarhan.

At 2:04 p.m. EST (1904 GMT), the Dow Jones IndustrialAverage .DJI rose 134.83 points, or 0.52 percent, to26,166.64; the S&P 500 .SPX gained 10.41 points, or 0.37percent, to 2,803.08; and the Nasdaq Composite .IXIC added42.48 points, or 0.56 percent, to 7,570.03.

The S&P 500 index's session high on Monday was 4.3 percentbelow its record closing reached in late September.

Of the S&P's 11 major sectors, financials .SPSY advancedmost with a 1 percent gain as banks .SPXBK rose 1.4 percent,following U.S. Treasury yields higher.

The S&P technology index .SPLRCT was up 0.6 percent, withthe biggest boost from Apple IncAAPL.O , gaining 0.7 percent. The Philadelphia semiconductor index .SOX climbed 1.3percent as chip companies have a big exposure to China.

The industrials sector .SPLRCI was 0.7 percent higher,with its biggest boost from General Electric CoGE.N , whichleaped 11 percent after announcing a sale of its biopharmabusiness to Danaher CorpDHR.N for $21.4 billion. Danahershares rose 8.2 percent. urn:newsml:reuters.com:*:nL3N20K3W3

The industrials sector was also helped by trade sensitiveCaterpillar Inc's CAT.N 2.7 percent jump and Boeing Co'sBA.N 0.9 percent rise.

Helping the risk-on sentiment was a flurry of M&A activity.

The Nasdaq Biotechnology Index .NBI was up 2 percent withits biggest boost coming from Spark Therapeutics IncONCE.O whose shares soared 120 percent after Swiss drugmaker RocheHolding AGROG.S agreed to buy it for $4.3 billion. urn:newsml:reuters.com:*:nL5N20K0QC

Canadian miner Barrick Gold CorpABX.TO offered to buyU.S. rival Newmont Mining CorpNEM.N for nearly $18 billion.However, Newmont's shares dipped 0.2 percent as the offer pricewas at a discount. urn:newsml:reuters.com:*:nL3N20K3OI

The biggest laggards were the S&P's defensive sectors -consumer staples .SPLRCS , utilities .SPLRCU and real estate .SPLRCR .

Advancing issues outnumbered declining ones on the New YorkStock Exchange by a 1.40-to-1 ratio; on Nasdaq, a 1.48-to-1ratio favored advancers.

The S&P 500 posted 58 new 52-week highs and 2 new lows; theNasdaq Composite recorded 121 new highs and 13 new lows. (Reporting by Sinead Carew in New York; Additional reporting byShreyashi Sanyal, Amy Caren Daniel in Bengaluru; Editing by AnilD'Silva and Jeffrey Benkoe) ((sinead.carew@thomsonreuters.com; +1 (646) 223 6186; ReutersMessaging: sinead.carew.thomsonreuters.com@reuters.net))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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