Wall Street rises on trade deal hopes; Apple hits record high

Wall Street rose for the third straight session on Friday, as investors expected top-level trade talks between the United States and China to result in a partial trade deal and delay planned US tariff increases.

Shares of Apple hit a record high and were the biggest boost to the S&P 500 and Nasdaq, while the technology sector was headed for its best day in five weeks.

President Donald Trump said the trade negotiations were going well, and he would meet Chinese Vice Premier Liu He later in the day. The top-level discussions enter their second day on Friday.

Analysts said equity markets have grown hungry for some sort of breakthrough in the latest round of negotiations.

The S&P 500 and Dow Jones indexes looked set to break a three-week losing streak on rising optimism that the world’s top two economies could cool off their row before more US tariffs kick in next week.

Chipmakers with a sizeable exposure to China rose in early trading. Intel Corp was up 2.3%, while Nvidia Corp and Advanced Micro Devices Inc gained 2.7% each.

Apple rose 1.7% as Wedbush raised its price target, citing confidence in the company’s new video streaming service.

At 10:21am the Dow Jones Industrial Average was up 405.65 points, or 1.53%, at 26,902.32, the S&P 500 was up 45.83 points, or 1.56%, at 2,983.96 and the Nasdaq Composite was up 139.27 points, or 1.75%, at 8,090.05.

The industrial sector gained 2.2%, boosted by a 15.4% jump in shares of Fastenal Co after the industrial distributor beat quarterly profit expectations.

Oil stocks rose 1.5%, as a report of an attack on an Iranian oil tanker lifted oil prices.

Focus now shifts to third-quarter earnings starting next week as investors brace for the impact of the trade war on Corporate America.

Analysts are expecting a 3.2% drop in S&P 500 earnings, marking the first decline since 2016, according to IBES data from Refinitiv.

Advancing issues outnumbered decliners for a 4.16-to-1 ratio on the NYSE and a 5.65-to-1 ratio on the Nasdaq.

The S&P index recorded 19 new 52-week highs and no new lows, while the Nasdaq recorded 32 new highs and 22 new lows.

US President Donald Trump sounded an optimistic note on Friday as high-level trade talks with China entered a second day, while Beijing indicated it was open to a “partial” deal that would avoid a planned hike in tariffs on its goods this month.

The two sides have been locked in on-again, off-again talks to resolve a 15-month trade war that has roiled financial markets, uprooted global supply chains and stoked fears of a global recession. Officials, including US Treasury Secretary Steven Mnuchin and Chinese Vice President Liu He, resumed the negotiations in Washington early on Friday. Liu is scheduled to meet Trump at the White House at 2:45pm,  according to the White House public schedule.

“Good things are happening at China Trade Talk Meeting. Warmer feelings than in recent past, more like the Old Days. I will be meeting with the Vice Premier today. All would like to see something significant happen!” Trump wrote on Twitter.

Mnuchin, arriving for the negotiations in Washington, told reporters the talks were “going well.” A Chinese state newspaper said on Friday that a “partial” trade deal would benefit China and the United States, and that Washington should take the offer, reflecting Beijing’s aim of cooling the row before more tariffs kick in.

Both sides have slapped duties on hundreds of billions of dollars of goods during the dispute, and Trump is threatening to raise tariffs to 30% from 25% on about $250 billion in Chinese goods on Oct. 15 if there is no progress on a deal.

On Thursday, Liu said China is willing to reach agreement with the United States on matters that both sides care about so as to prevent friction from leading to further escalation of the trade war. He stressed that “the Chinese side came with great sincerity.” Adding to that, the official China Daily newspaper said in an editorial in English on Friday: “A partial deal is a more feasible objective”.

“Not only would it be of tangible benefit by breaking the impasse, but it would also create badly needed breathing space for both sides to reflect on the bigger picture,” the paper said.

Trump, who said on Thursday that talks with the Chinese had not gone well, has previously insisted he would not be satisfied with a partial deal to resolve his two-year effort to change China’s trade, intellectual property and industrial policy practices, which he argues cost millions of US jobs.

Investors and business groups, however, saw China’s dangling of a partial deal as a sign of progress.

Major US stock indexes were trading sharply higher on Friday, with the S&P 500 index up about 1.5%.

China’s securities regulator on Friday also unveiled a firm timetable for scrapping foreign ownership limits in futures, securities and mutual fund companies for the first time. Increasing foreign access to the sector is among the US demands at the trade talks.

Agencies