US STOCKS-China tariff cut set to power Wall St to record highs

Published 06/02/2020, 14:47
Updated 06/02/2020, 14:55
© Reuters.  US STOCKS-China tariff cut set to power Wall St to record highs

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* China to halve extra tariffs on some U.S. imports

* Three main indexes set to hit record highs at the open

* Twitter advances as quarterly revenue tops $1 bln

* Kellogg declines after quarterly sales fall from year ago

* Futures up: Dow 0.37%, S&P 0.31%, Nasdaq 0.36%

(Adds quote, details; updates prices)

By Medha Singh

Feb 6 (Reuters) - Wall Street's main indexes were set to hit

record highs at the open on Thursday as China's plan to chop

additional tariffs on some American goods by 50% helped ease

fears over the financial fallout of the coronavirus epidemic.

Beijing said it would lower extra levies imposed last year

against 1,717 U.S. products, weeks after the signing of a Phase

1 trade deal. The tariff cut follows hefty monetary stimulus by China's

central bank earlier this week to support an economy hit by

shutdowns and travel restrictions due to the virus outbreak.

"The fear investors had when the virus first started seems

to have abated somewhat," said Rick Meckler, partner, Cherry

Lane Investments, a family investment office in New Vernon, New

Jersey.

A string of positive U.S. economic data too have helped

mitigate worries, fueling a three-day rally on Wall Street. The

Nasdaq .IXIC hit a record high on Wednesday and the S&P 500

.SPX is on pace for its best week in eight months after last

week's steep pullback.

However, the impact of the health emergency in China

continued to show up in corporate reports. Chipmaker Qualcomm

Inc QCOM.O flagged a potential threat to the mobile phone

industry from the outbreak, with a possible impact on

manufacturing and sales. Its shares fell 1.8% in premarket trading.

At 8:26 a.m. ET, Dow e-minis 1YMcv1 were up 109 points, or

0.37%. S&P 500 e-minis EScv1 were up 10.5 points, or 0.31% and

Nasdaq 100 e-minis NQcv1 were up 33.5 points, or 0.36%.

The fourth-quarter earnings season is more than half done

with nearly 70% of S&P 500 companies exceeding their earnings

estimates, according to IBES data form Refinitiv.

Twitter Inc TWTR.N gained about 8.3% after the

micro-blogging platform touched $1 billion in quarterly revenue

for the first time ever, beating analysts' estimates.

Breakfast cereal maker Kellogg Co K.N tumbled 6.3% after

it reported a decline in fourth-quarter sales. Tesla Inc TSLA.O slipped 3.4%, falling for the second day

after a stunning six-day rally.

As the week draws to a close, investor attention will shift

to the crucial U.S. jobs report on Friday.

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