US STOCKS-Wall St climbs on trade optimism, dovish Fed bets

(For a live blog on the U.S. stock market, click LIVE/ or
type LIVE/ in a news window.)
* Trump says trade talks to restart, will meet Xi
* Tech boosts S&P; trade-sensitive industrials jump
* Two-day Fed policy meeting starts Tuesday
* Indexes up: Dow 1.21%, S&P 1.17%, Nasdaq 1.78%

(Updates to open)
By Shreyashi Sanyal
June 18 (Reuters) - U.S. stocks rallied on Tuesday, with the
S&P 500 closing in on record levels, as President Donald Trump's
comments on the United States and China restarting trade talks
added to optimism over the prospect of a more accommodative
Federal Reserve.
Trump said he would meet with Chinese President Xi Jinping
at the G20 summit later this month, and that trade talks between
the two countries would restart after a long lull. This helped the trade-sensitive industrials .SPLRCI jump
1.62%, while technology stocks .SPLRCT gained 1.79%, offering
the biggest boost to the benchmark index.
Chip companies, which have a sizable revenue exposure to
China, led the rally among tech stocks with the Philadelphia
Semiconductor index .SOX surging 4%.
The U.S. central bank is expected to leave interest rates
unchanged at its two-day policy meeting starting Tuesday, but is
widely seen as laying the foundation for a cut later this year.
The Fed's statement at 2 p.m. EDT (1800 GMT) on Wednesday
will likely provide insights into the impact of the U.S.-China
trade war, President Donald Trump's calls for a rate cut and
weaker economic data on monetary policy. Hopes of a rate cut have helped the S&P 500 .SPX rise 5%
this month, putting the benchmark index just 1% away from its
all-time high hit in early May.
"A rate cut this week is off the table. But all eyes and
ears will be tuned into what the Fed Chairman says about the
outlook and how he hints about what is next," said Steven
Skancke, chief economic adviser at wealth management and
investment advisory firm Keel Point in Washington.
"The big belief is for a rate cut in September but everyone
is looking for a hint that it might come at the next meeting at
the end of July."
Lifting sentiment was ECB President Mario Draghi's comments
indicating a possibility of new rate cuts or asset purchases.
At 10:07 a.m. ET, the Dow Jones Industrial Average .DJI
was up 316.31 points, or 1.21%, at 26,428.84, the S&P 500 was up
33.71 points, or 1.17%, at 2,923.38.
The Nasdaq Composite .IXIC was up 139.36 points, or 1.78%,
at 7,984.39.
Large-cap volatile favorites such as Facebook Inc FB.O ,
Apple Inc AAPL.O , Amazon.com Inc AMZN.O , Microsoft Corp
MSFT.O all rose between 1% and 2%, offering the biggest boost
to the Nasdaq.
Facebook climbed 1.34% after it revealed plans to launch a
cryptocurrency called Libra, the latest development in its
effort to expand beyond social networking and move into
e-commerce and global payments. Advancing issues outnumbered decliners by a 6.38-to-1 ratio
on the NYSE and by a 4.43-to-1 ratio on the Nasdaq.
The S&P index recorded 49 new 52-week highs and no new low,
while the Nasdaq recorded 59 new highs and 17 new lows.