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US STOCKS-S&P 500 and Nasdaq set to snap six-day losing streak

Reuters | New York | Updated: 06-08-2019 23:04 IST | Created: 06-08-2019 23:01 IST
US STOCKS-S&P 500 and Nasdaq set to snap six-day losing streak
Image Credit: Public Domain Pictures

U.S. stocks rose on Tuesday as China stepped in to stabilize the yuan, soothing concerns that currencies would be the latest weapon in the long-drawn trade war, a day after Wall Street suffered their sharpest one-day percentage drops of the year.

China's overnight intervention came after the U.S. Treasury Department labeled Beijing as a currency manipulator as it let the yuan slide to a more than decade low on Monday. A steep fall in the Chinese currency had led the benchmark S&P 500 and Nasdaq record their sixth straight session of declines, losing at least 3% each in the previous session.

China's move to fix the yuan at a slightly stronger rate and White House economic adviser Larry Kudlow's comment that President Donald Trump was planning to host a Chinese delegation for further talks in September allayed fears of a further escalation in trade war. The S&P 500, still reeling from last week's shock when President Donald Trump vowed to slap a 10% tariff on a further $300 billion in Chinese imports, is 5.6% away from its all-time high hit last month.

"Both sides are at that point where they must go back and renegotiate," said Kim Forrest, chief investment officer at Bokeh Capital Partners in Pittsburgh. "Yesterday's big drop off has allowed bargain hunters to find bargains."

The technology sector, which includes companies that have a big exposure to China and were at the heart of Monday's selloff, rose 0.68%. Apple Inc gained 0.8% after three days of heavy losses, while Philadelphia Semiconductor index edged 0.40% higher.

At 12:55 p.m. ET, the Dow Jones Industrial Average was up 61.05 points, or 0.24%, at 25,778.79, the S&P 500 was up 9.12 points, or 0.32%, at 2,853.86. The Nasdaq Composite was up 32.53 points, or 0.42%, at 7,758.57. Among other stocks, Take-Two Interactive Software Inc jumped 9.5% after the videogame publisher raised its full-year revenue forecast.

The materials sector dropped 1%, weighed by a more than 13% fall in scent and flavor maker International Flavors & Fragrances and fertilizer company Mosaic Co after the two companies cut their full-year earnings forecasts. Payments processor Mastercard Inc gained 2.1% after it said it would buy a majority of the corporate services businesses of Scandinavian payments group Nets for about $3.19 billion.

Walt Disney Co was up 0.8% ahead of its results after market close. Advancing issues outnumbered decliners by a 1.20-to-1 ratio on the NYSE and by a 1.03-to-1 ratio on the Nasdaq.

The S&P index recorded two new 52-week highs and 23 new lows, while the Nasdaq recorded 17 new highs and 166 new lows.

Also Read: India's Ladakh Buddhist enclave jubilant at new status but China angered


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