Stocks rose on Tuesday amid news that U.S. lawmakers had secured a tentative deal on border security funding. Improved prospects for a U.S.-China trade deal also boosted equities.
The Dow Jones Industrial Average vaulted 372.65 points, or 1.5%, to 25,425.76, led by Caterpillar and 3M.
The S&P 500 gained 34.93 points, or 1.3%, to 2,744.73, as materials, consumer discretionary and financials outperformed. The broader index also closed above its 200-day moving average — a closely watched level by traders — for the first time since Dec. 3.
The NASDAQ Composite hiked 106.71 points, or 1.5%, to 7,414.62
Shares of big banks gained broadly. Goldman Sachs, Citigroup and Morgan Stanley all rose at least 1.6%. Bank of America and J.P. Morgan Chase also gained at least 1%.
On Monday night, congressional negotiators struck a deal in principle that would keep the government open and avoid a shutdown on Friday.
The drafted agreement did not contain funds for President Donald Trump’s border wall, however. If the government is going to avoid another shutdown, it will need support from Trump, however.
The government was shut down for 35 days until Jan. 25, the longest one in history, as Trump and congressional leaders could not come to terms on funding for a wall along the U.S.-Mexico border.
There is also the prospect of a trade deal with China. News reports are circulating that some U.S. aides acknowledge the most likely scenario at this point is the deadline will be moved given how far behind both sides are on trade talks. The trade dispute has already started to impact global growth, with investors worried a protracted dispute could soon severely hurt corporate earnings.
Shares of Deere, Boeing and Caterpillar all rose Tuesday. These stocks are seen as global-trade bellwethers for their exposure to overseas markets.
Shares of major tech companies like Amazon, Netflix and Alphabet all rose more than 2%. Apple’s stock also gained 0.9%
Prices for the benchmark 10-year U.S.Treasury lost ground, boosting yields to 2.68% from Monday’s 2.66%. Treasury prices and yields move in opposite directions.
Oil prices added 68 cents to $53.09U.S. a barrel.
Gold prices gained $2.70 to $1,314.60U.S. an ounce.
This article provided by NewsEdge.