(Reuters) – Wall Street’s main indexes hit session highs on Tuesday as investors concerns about rising U.S.-China trade tension receded after Chinese President Xi Jinping promised to cut import tariffs.
Ten of the 11 major S&P sectors were higher, with the energy index adding more than 3 percent as oil broke above $70 a barrel. The biggest boost came from a 2.2 percent gain in the technology sector.
The S&P and the tech-heavy Nasdaq were up more than a percent, while the Dow gained 2 percent with 29 of its 30 components in the positive territory.
In his first public comments since the trade dispute with the Trump administration started, Xi vowed to open the country’s economy and said China would raise the foreign ownership limit in automobile, shipbuilding and aircraft sectors “as soon as possible”.
His comments buoyed global markets, which have been under pressure as China and the United States threatened each other with billions in tariffs and investors feared that protectionist measures would hit global economic growth.
“What you are seeing in the market is an alleviation of trade war fears and people trying to get back in and reposition themselves for what they hope – no trade war,” said Robert Pavlik, chief investment strategist and senior portfolio manager at SlateStone Wealth LLC in New York.
U.S. stocks will face a major test in coming weeks as first-quarter earnings pour in. Big banks such as JPMorgan Chase, Citigroup and Wells Fargo will kick off the earnings season with their results on Friday.
Analysts expect quarterly profits for S&P 500 companies to rise 18.5 percent from a year ago, which would be the biggest gain in seven years, according to Thomson Reuters I/B/E/S.
At 11:31 a.m. EDT the Dow Jones industrial average was up 492.44 points, or 2.05 percent, at 24,471.54.
The S&P 500 was up 43.86 points, or 1.68 percent, at 2,657.02 and the Nasdaq Composite was up 120.52 points, or 1.73 percent, at 7,070.86.
The so-called FANG stocks – Facebook Inc, Amazon.com, Netflix Inc and Alphabet Inc’s Google – were up between 1 percent and 2.6 percent ahead of Facebook CEO Mark Zuckerberg’s testimony before U.S. lawmakers on Tuesday and Wednesday.
The CEO is expected to strike a conciliatory tone in an attempt to blunt possible regulatory fallout from the privacy scandal engulfing his social network.
Shares of Spectrum Pharma rose 22 percent after company provided positive data from lung cancer drug trial.
Verifone Systems shares rose 52 percent after the company agreed to be taken private for $2.28 billion.
Advancing issues outnumbered decliners on the NYSE for a 4.69-to-1 ratio on the upside and on the Nasdaq for a 3.98-to-1 ratio favoring advancers.
The S&P 500 index showed six new 52-week highs and one new lows, while the Nasdaq recorded 36 new highs and 22 new lows.
(Reporting by Sweta Singh in Bengaluru; Additional reporting by Nikhil Subba; Editing by Arun Koyyur)