Thursday's Stock Market Close: Traders Buoyed By China Trade Talks Hopes

U.S. traders took heart Thursday in the resumption of trade talks between the U.S. and China and word of a possible “pathway to a deal” ahead of the United Kingdom’s Brexit deadline.

The Dow Jones Industrial Average soared 152 points to 26,498 while the Nasdaq Composite added 47 points to 7,950 and the S&P 500 gained 18 points to 2,938.

Volume on the New York Stock Exchange totaled 2.45 billion shares with 1,848 issues advancing and 1,089 declining. Forty-eight stocks hit new highs and 40 set new lows.

The most actives were led by Freeport-McMoRan (FCX), Bed Bath & Beyond (BBBY) and PG&E (PCG).

In economic news, the consumer price index was unchanged in September, the Bureau of Labor Statistics reported. In the past 12 months, prices have risen 1.7%, 3 points before the Federal Reserve’s target 2% rate. Increases in the cost of food and shelter were offset by declines in energy and used vehicle costs. Excluding food and energy costs, the index rose 0.1% in September.

President sparked hopes for a resolution of the U.S.-China trade war, tweeting he would meet Friday with Vice Premier Liu He, China’s chief trade negotiator. Liu opened talks Thursday with U.S. Trade Rep. Robert Lighthizer and Treasury Secretary Steven Mnuchin.

“They want to make a deal, but do I?” Trump teased on Twitter.

China has indicated it wants to narrow the scope of the talks, taking demands over industrial reforms and government subsidies off the table. The U.S. is seeking agreement governing intellectual property and other national security-related issues. Trump has said he’d rather have no deal than a “bad” deal and also has rejected an agreement dealing only with agriculture issues.

The talks come ahead of next week’s deadline for 30% tariffs on $250 billion to kick in, representing a 5-point increase in the levies.

Prior to the start of the talks, the White House approved licenses for American firms doing business with Chinese telecom giant Huawei Technologies, which is on the Treasury Department’s sanctions list.

British Prime Minister Boris Johnson and Irish Taoiseach Leo Varadkar said Thursday they see a “pathway to a possible deal” following three hours of private talks ahead of the Oct. 31 deadline for the United Kingdom to leave the European Union.

Johnson hosted Varadkar at a country house in northwest England after which they issued a joint statement expressing optimism ahead of next week’s EU summit. The other 26 members of the European Council have said they want a deal in writing before Tuesday’s meeting.

Varadkar told reporters he thinks agreement is possible, and he is convinced both Dublin and London want “an agreement that’s in the interests of Ireland and the U.K., and the EU as a whole.” Varadkar acknowledged there still are issues that need resolution, including a longterm solution for Northern Ireland.

EU chief Brexit negotiator Michel Barnier was expected to decide Friday if the two-way talks made enough progress to pave the way for a breakthrough.

On global markets, Asian and European stocks closed higher.

Hong Kong’s Hang Seng added 0.1% while Japan’s Nikkei 225 gained 0.45% and China’s Shanghai Composite was up 0.78%. Australia’s S&P/ASX was flat, up just 0.01%.

The London FTSE 100 was up 0.28% while the German DAX was off 0.58% and the French CAC 40 was up 1.27% in early afternoon trading. The Stoxx Europe 600 gained 0.82%%.

On currency markets, the British pound was 2.41 cents at $1.2rru while the euro added 0.33 cents to $1.1006. The dollar index was off 0.42%.

Oil futures were higher. Crude oil added $1.11 to $53.70 while Brent crude added 19 cents to $59.29. Gold futures lost $14.40 to 1,498.40 an ounce while silver futures dipped 26 cents to $17.55 an ounce.

Yield on the 10-year Treasury note rose to 1.661%, off 29/32 while the 30-year note rose to 2.158% off 16/32.