Wall Street stock prices rose yesterday as investors hoped US-China trade tensions could ease, while the pound soared on rising prospects for a finalized agreement on the UK’s exit from the EU.
Oil prices fell more than three per cent, but US natural gas futures soared to their highest since November 2014 on forecasts for colder weather.
The US benchmark S&P 500 stock index rose on reports that US Treasury Secretary Steven Mnuchin had resumed discussions with China Vice Premier Liu He. Technology stocks bounced back a day after a rout that led the S&P 500's nearly two per cent decline.
US equities rose further after White House Economic Advisor Larry Kudlow said Washington had resumed trade talks with China and characterised the development as “very positive.”
“It’s potentially good news on the trade war front,” said Edmund Tran, equity strategist at UBS Global Wealth Management in New York.
The US dollar index, which has steadily climbed as the US-China trade dispute has escalated, dipped 0.4 per cent.
Conversely, the pound rose 1.4 per cent to $1.3033 after reports that the UK and the EU had agreed upon the text of a Brexit agreement and that British Prime Minister Theresa May would hold a Cabinet meeting today.
The euro also rose from a 16-month low, last up 0.6 to $1.1282, though its gains were capped by concerns over Italy's budget. The Italian government faces a Tuesday deadline to submit a revised budget to the EU.
The Dow Jones Industrial Average rose 32.82 points, or 0.13 per cent, to 25,420, the S&P 500 gained 14.02 points, or 0.51 per cent, to 2,740.24 and the Nasdaq Composite added 62.16 points, or 0.86 per cent, to 7,263.03.
The pan-European STOXX 600 added 0.67 per cent to 364.44. MSCI’s gauge of stocks across the globe gained 0.36 per cent.
Benchmark 10-year US Treasury notes last rose 8/32 in price to yield 3.1599 percent, from 3.189 percent late on Friday. The Treasury market was closed on Monday for the Veterans Day holiday.
Oil prices extended their fall from Monday after US President Donald Trump put pressure on Opec not to cut supply to prop up prices.
US crude fell 4.27 per cent to $57.37 per barrel and Global benchmark Brent crude was down $2.70 a barrel at $67.42.
Both crude benchmarks have fallen more than 20 per cent since peaking at four-year highs in early October.