Wall Street gains traction on trade optimism to close strongly higher
|- Renewed trade optimism boosts stocks on Friday.
- CBOE Volatility Index drops more than 4%.
- Technology and communication services lead the rally.
After starting the day modestly higher, major equity indexes in the U.S. gained traction in the second half of the session and finished the week on a positive note boosted by improved market sentiment. In fact, the CBOE Volatility Index, Wall Street's fear gauge, fell more than 4%.
Following his meeting with Chinese Vice Premier Liu in Washington, President Trump said that there was a very good chance to reach a deal and explained that he would be meeting his Chinese counterpart Xi to make the final decision on trade. “The working assumption that we have is that the two sides are going to go past the deadline because I think it’s going to require the two presidents to meet to finalize on certain aspects of the deal,” Myron Brilliant, head of international affairs for the U.S. Chamber of Commerce, said, as reported by Reuters.
The risk-sensitive S&P 500 Technology and the S&P 500 Communication Services both gained more than 1% on the day and supported the tech-heavy Nasdaq Composite, which added 0.9% on the day to close at 7,527.55. On the other hand, with the 10-year T-bond yield losing more than 1% on Friday, the S&P 500 Financials Index erased 0.23% on the day.
The Dow Jones Industrial Average gained 181.48 points, or 0.7%, to 26,032.11 and the S&P 500 rose 17.78 points, or 0.64%. For the week, these indexes added 0.57% and 0.62%, respectively while the Nasdaq Composite climbed 0.74%.
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