Stocks set new all-time highs on U.S.-China trade optimism.
The U.S. stock market surged on Thursday amid reports that Washington and Beijing were inching closer to finalizing their ‘phase one’ trade agreement.
All of Wall Street’s major indices recorded new highs. The Dow Jones Industrial Average (DIA) rose 184.46 points, or 0.7%, to 27,677.02. The broad S&P 500 Index (SPY) gained 0.3% to finish at 3,085.31. The technology-focused Nasdaq Composite Index jumped 0.3% to close at 8,434.52.
Even with stocks rallying, the CBOE VIX Volatility Index (VXX) barely moved on Thursday. The so-called “investor fear index” hovered within a half point range, eventually settling at 12.86 on a scale of 1-100 where 20 represents the historic average.
Markets rallied on Thursday amid news that the United States and China had agreed to roll back tariffs as part of a ‘phase one’ trade agreement. Gao Feng, a spokesman with China’s Commerce Ministry, issued the following statement:
“If the phase-one deal is signed, China and the U.S. should remove the same proportion of tariffs simultaneously based on the content of the deal. This is what [the two sides] agreed on following careful and constructive negotiations over the past two weeks.”
As of Thursday evening, no agreement has been finalized.
In economic data, U.S. initial jobless claims declined more than expected last week but remain well above the multi-decade lows from earlier in the year. The number of Americans filing for first-time unemployment benefits declined by 4,000 to a seasonally adjusted 211,000 in the week ended Nov. 1, the Labor Department reported Thursday.
The Final Word: U.S.-China trade optimism continues to fuel Wall Street. President Trump and China’s Xi Jinping have rescheduled their meeting until next month, giving negotiators more time to hammer out a deal before the next presidential summit.