March 5 (Reuters) – Wall Street’s main indexes finished higher in choppy trading on Wednesday, as investors cheered the likely easing of trade tensions between the U.S. and major trading partners.
Stocks turned positive after a report said President Donald Trump was considering a one-month delay of auto tariffs on Canada and Mexico. Equities extended gains after a White House announcement confirmed that Trump agreed to delay tariffs on some vehicles.
Earlier, Wall Street had lost ground following mixed economic data and as investors also worried about a trade war.
“We are on the tariff roller coaster,” said Wasif Latif, chief investment officer at Sarmaya Partners in New Jersey. “The economic data, the Fed, and all that stuff seems to have been pushed to the background for now. It’s just a reminder how these policies have an impact in the long run and the markets are reacting to it.”
Stocks in materials (.SPLRCM)
, opens new tab, industrials (.SPLRCI)
, opens new tab, consumer discretionary (.SPLRCD)
, opens new tab and communication services (.SPLRCL)
, opens new tab were the main drivers of gains among the 11 sectors on the benchmark S&P 500. Energy (.SPNY)
, opens new tab and utilities (.SPLRCU)
, opens new tab were the biggest losers.
The Dow Jones Industrial Average (.DJI)
, opens new tab rose 485.60 points, or 1.14%, to 43,006.59, the S&P 500 (.SPX)
, opens new tab gained 64.48 points, or 1.12%, to 5,842.63 and the Nasdaq Composite (.IXIC)
, opens new tab gained 267.57 points, or 1.46%, to 18,552.73.
Early in the session, an ISM report showed an unexpected rise in growth in the services sector in February. However, signs of increased input prices tempered optimism.
Separately, ADP data showed private payrolls increased in February at the slowest pace in seven months. Investors now await Friday’s crucial payrolls report.
Morning sunlight falls on the facade of the New York Stock Exchange (NYSE) building in Manhattan in New York City, New York, U.S., January 28, 2021. REUTERS/Mike Segar/File Photo Purchase Licensing Rights
Riskier equities have sold off over the past few weeks as investors worried Trump’s trade policies would amplify inflation pressures, slow the economy and eat into corporate profits. Multiple reports have suggested a cooling economy.
“The long-term trend that we were in, which is the rally from the pandemic lows, has basically tapped out and on top of that you put Trump, whose policies – whether it’s tariffs, deportations or the extension of the 2017 tax cut – are all going to hurt the economy or cause inflation,” said Bill Strazzullo, chief market strategist at Bell Curve Trading in Boston.
Carmaker stocks rose, with Ford (F.N)
, opens new tab up 5.8% and General Motors (GM.N)
, opens new tab up 7.2%. Tesla (TSLA.O)
, opens new tab gained 2.6%.
Chipmaker Intel (INTC.O)
, opens new tab dropped 2.4% after Trump said on Tuesday that lawmakers should get rid of a law offering subsidies to the semiconductor industry.
CrowdStrike (CRWD.O)
, opens new tab fell 6.3% after the cybersecurity firm forecast first-quarter revenue slightly below estimates.
Huntington Ingalls (HII.N)
, opens new tab jumped 12.3% after Trump said his administration will create an office of shipbuilding in the White House and offer tax incentives.
Advancing issues outnumbered decliners by a 1.99-to-1 ratio on the NYSE. There were 93 new highs and 146 new lows on the NYSE.
The S&P 500 posted 3 new 52-week highs and 8 new lows while the Nasdaq Composite recorded 42 new highs and 163 new lows.
Total volume across U.S. exchanges was 15.50 billion shares, compared with the 20-day moving average of 15.97 billion shares.
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Reporting by Johann M Cherian and Sukriti Gupta in Bengaluru and Chibuike Oguh in New York; Editing by Shinjini Ganguli and David Gregorio
Our Standards: The Thomson Reuters Trust Principles.
Chibuike reports on Breaking News, with a focus on finance and markets. He previously covered U.S. private equity firms, and holds master’s degrees in journalism from New York University and Edinburgh Napier University.
