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US STOCKS-Wall Street extends gains as trade talks progress

Tablet displaying intraday stock performance

(Corrects paragraph 8 to say first quarter instead of fourthquarter)

* CPI grows at slowest annual pace in 1-1/2 yrs

* Mnuchin expresses optimism on Beijing trade negotiations

* Energy stocks advance as crude prices rise

* Indexes up: Dow 0.36 pct, S&P 0.30 pct, Nasdaq 0.26 pct

By Stephen Culp

NEW YORK, Feb 13 (Reuters) - Wall Street extended its gainson Wednesday as investor optimism was stoked over hopes that theUnited States and China could iron out a trade deal, and tameinflation data suggested the Fed would hold interest ratessteady in the near term.

All three major U.S. stock indexes were up, and the S&P 500held above its 200-day moving average, a key technical level.

In Beijing, U.S. Treasury Secretary Steven Mnuchin said "sofar, so good," regarding ongoing talks aimed at resolving theU.S.-China trade dispute, adding that he hoped for "productive"meetings in the days ahead.

"The market is ahead of itself until we get a deal withChina," said Matthew Keator, partner in the Keator Group, awealth management firm in Lenox, Massachusetts. "It seems to bea bit of a moving target, but it seems both sides are willing toconstruct a deal."

The U.S. Labor Department reported that consumer prices wereunchanged for the third consecutive month in January, andincreased at their slowest annual pace in more than 1-1/2 yearsin a sign that the Federal Reserve could let interest ratesstand for a while.

Fourth-quarter earnings season approaches the finish line,with more than two-thirds of S&P 500 having reported.

While analysts now see fourth-quarter earnings growth of16.6 percent, the outlook for the current quarter is lessauspicious.

First-quarter profit is projected to fall 0.3 percent from ayear ago, marking the first loss since the earnings recessionthat ended in 2016, according to Refinitiv data.

"Volatility in the fourth quarter was a precursor to whatwe're seeing now," said Keator. "Companies are resettingexpectations going forward."

The Dow Jones Industrial Average .DJI rose 90.76 points,or 0.36 percent, to 25,516.52, the S&P 500 .SPX gained 8.17points, or 0.30 percent, to 2,752.9 and the Nasdaq Composite .IXIC added 19.29 points, or 0.26 percent, to 7,433.91.

Of the 11 major sectors in the S&P 500, all but utilities .SPLRCU were in positive territory.

Energy companies .SPNY were among the biggest percentagegain as oil prices LCOc1 saw their largest increase since lateJanuary.

Groupon IncGRPN.O sank 12.1 percent, among the biggestlosers on the Nasdaq .IXIC as reduced traffic led to afourth-quarter profit miss.

Generic drugmaker Teva Pharmaceuticals Industries IncTEVA.N dropped 7.8 percent after forecasting aweaker-than-expected 2019 due to new competition for brandeddrugs.

General Electric CoGE.N advanced 3.1 percent followingnews that the conglomerate booked the most orders forelectricity-generating gas turbines in 2018.

Levi Strauss & Co filed documents for an IPO after more thanthree decades as a privately-held company.

Cisco Systems'CSCO.O stock was down 0.8 percent ahead ofits earnings release, expected after the bell.

Advancing issues outnumbered declining ones on the NYSE by a1.80-to-1 ratio; on Nasdaq, a 1.40-to-1 ratio favored advancers.

The S&P 500 posted 35 new 52-week highs and no new lows; theNasdaq Composite recorded 67 new highs and 15 new lows. (Reporting by Stephen CulpEditing by Chizu Nomiyama) ((stephen.culp@thomsonreuters.com; 646-223-6076;))


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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