US close: Markets end higher as investors hope for truce extension

Wall Street trading ended on a positive note on Wednesday, with investors remaining hopeful of a trade truce extension between the US and China after Donald Trump said he would let the deal deadline slide if both parties were making headway.

The Dow Jones Industrial Average finished the day up 0.46% at 25,543.27, the S&P 500 added 0.3% to 2,753.03, and the Nasdaq 100 ended 0.02% higher at 7,015.88.

Traders had pushed the Dow more than 150 points higher at the open, as Trump, who had previously insisted the 1 March cut-off date was a "hard deadline" for an agreement, said on Tuesday that he would be more flexible if a deal between the pair looked close.

“It goes without saying that the prospect of further escalations in the trade conflict between the world’s two largest economies is a major risk factor for markets,” said Oanda analyst Craig Erlam.

“We may not have reached a point at which an agreement is imminent but the acknowledgement that they could let the deadline slide is encouraging, both in terms of it being a sign of progress and the elimination of near-term tariff risks.”

Chinese President Xi Jinping is expected to meet key members of a US delegation in Beijing on Friday.

Trump also said on Tuesday that another government shutdown was unlikely, despite expressing unhappiness with a tentative agreement that allowed for just 55 miles of new border.

“One area where the President appears to have been forced to swallow some pride is on the border wall, with the previous shutdown having not gone the way he assumed,” Erlam added.

“Trump is yet to sign the deal that was struck earlier this week but it would appear he's going to which will avoid another long shutdown but force him to source the majority of the funds for the wall from elsewhere.

“The only question now is how he’ll sell this as a victory to his supporter base.”

On the data front, US consumer prices were unchanged for a third straight month in January, leading to the smallest annual increase in inflation in more than a year and a half.

The Labor Department revealed that its consumer price index was held down by lower gasoline prices, offsetting increases in the cost of food and rent.

In the 12 months through January, the CPI rose 1.6%, the smallest gain since June 2017, while CPI increased 1.9% year-on-year a month earlier.

Elsewhere, American household debt rose to $13.5trn at the end of 2018, fuelling concerns that the US is ill-prepared for any potential downturn in its economic fortunes.

According to a debt and credit report published by the Federal Reserve Bank of New York, aggregate borrowing to cover mortgages, credit cards, student loans and car loans was $13.5trn in the fourth quarter, a record high and the eighteenth quarter in a row that debt has risen.

Mortgage borrowing, which makes up the largest proportion of household debt, dipped for the first time in two years. But other forms of borrowing, such as credit cards, rose.

Total borrowing now exceeds the pre-crisis peak of 2008, and is up by a fifth from post-crisis lows in early 2013.

Credit card and car loan delinquencies - defined as payments being late by 90 days or more - also rose in the fourth quarter.

“This has possible implications for auto demand in the US, which has already flattened out, and leaves American consumers exposed to any unexpected loss of their job or increase in interest rates and thus borrowing costs,” said Russ Mould, investment director at AJ Bell.

In corporate news, Hilton Hotels was up 6.91% at the open after beating profit and revenue expectations in its fourth trading quarter and issuing an upbeat outlook.

Activision Blizzard shares picked 6.96% after the bell despite its earnings and forecast overnight falling short of expectations amid layoffs.

DISH Network fell 7.68% after revealing that subscriber numbers had missed expectations in the fourth quarter.

CBRE was up 2.95% ahead of its fourth-quarter earnings, while DelMar Pharmaceuticals traded 1.1% lower ahead of its own figures.

Dow Jones - Risers

3M Co. (MMM) $209.64 4.35%
Caterpillar Inc. (CAT) $133.10 3.23%
Merck & Co. Inc. (MRK) $79.02 3.01%
Home Depot Inc. (HD) $188.41 3.00%
Exxon Mobil Corp. (XOM) $76.22 2.90%
International Business Machines Corp. (IBM) $137.52 2.63%
Unitedhealth Group Inc. (UNH) $263.76 2.59%
Chevron Corp. (CVX) $119.57 2.24%
Dowdupont Inc. (DWDP) $53.14 2.19%
JP Morgan Chase & Co. (JPM) $103.09 2.19%

Dow Jones - Fallers

Cisco Systems Inc. (CSCO) $47.50 -0.81%
Apple Inc. (AAPL) $170.18 -0.42%
Microsoft Corp. (MSFT) $106.81 -0.07%
McDonald's Corp. (MCD) $174.00 -0.06%
Pfizer Inc. (PFE) $41.70 0.05%
Coca-Cola Co. (KO) $49.79 0.36%
Walt Disney Co. (DIS) $110.20 0.69%
Verizon Communications Inc. (VZ) $54.48 0.80%
Intel Corp. (INTC) $50.47 0.92%
Procter & Gamble Co. (PG) $99.24 0.99%

S&P 500 - Risers

Activision Blizzard Inc. (ATVI) $44.57 6.96%
Freeport-McMoRan Inc (FCX) $12.29 6.59%
D. R. Horton Inc. (DHI) $40.17 6.38%
Apache Corp. (APA) $32.28 6.36%
PG&E Corp. (PCG) $15.21 6.14%
Pioneer Natural Resources Co. (PXD) $145.41 6.03%
Devon Energy Corp. (DVN) $26.91 5.78%
Murphy Oil Corp. (MUR) $28.24 5.73%
Newfield Exploration Co (NFX) $17.07 5.37%
CBRE Group Inc (CBRE) $49.24 5.30%

S&P 500 - Fallers

Molson Coors Brewing Co. Class B (TAP) $59.68 -8.69%
TripAdvisor Inc. (TRIP) $56.94 -5.71%
Cerner Corp. (CERN) $56.93 -3.21%
Martin Marietta Mtrl (MLM) $180.41 -2.99%
Pitney Bowes Inc. (PBI) $7.02 -2.50%
Netflix Inc. (NFLX) $351.77 -2.28%
Endo International Plc (ENDP) $10.52 -2.14%
Fidelity National Information Services Inc. (FIS) $106.79 -2.12%
Ralph Lauren Corp (RL) $123.26 -1.88%
Urban Outfitters Inc. (URBN) $30.80 -1.79%

Nasdaq 100 - Risers

Activision Blizzard Inc. (ATVI) $44.57 6.96%
Marriott International - Class A (MAR) $118.86 3.59%
Take-Two Interactive Software Inc. (TTWO) $92.14 3.24%
Micron Technology Inc. (MU) $41.68 3.17%
Baidu Inc. (BIDU) $173.82 2.10%
DENTSPLY Sirona Inc. (XRAY) $43.87 2.07%
Henry Schein Inc. (HSIC) $62.09 1.77%
Booking Holdings Inc. (BKNG) $1,919.97 1.30%
American Airlines Group (AAL) $36.21 1.29%
Walgreens Boots Alliance, Inc. (WBA) $72.43 1.22%

Nasdaq 100 - Fallers

Dish Network Corp. (DISH) $28.86 -7.68%
Cerner Corp. (CERN) $56.93 -3.21%
Netflix Inc. (NFLX) $351.77 -2.28%
Symantec Corp. (SYMC) $23.02 -1.67%
NetEase Inc. Ads (NTES) $240.53 -1.58%
Mylan Inc. (MYL) $31.25 -1.54%
Cadence Design Systems Inc. (CDNS) $51.36 -1.48%
Tesla Inc (TSLA) $308.17 -1.17%
Intuitive Surgical Inc. (ISRG) $533.47 -1.16%
Regeneron Pharmaceuticals Inc. (REGN) $412.09 -1.02%