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US STOCKS-Wall Street gains on Apple boost, trade optimism

Published 11/09/2019, 18:32
Updated 11/09/2019, 18:40
© Reuters.  US STOCKS-Wall Street gains on Apple boost, trade optimism
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* Apple biggest boost to tech sector

* China exempts 16 types of U.S. goods from tariffs

* Baker Hughes falls as GE looks to cut stake

* Indexes up: Dow 0.39%, S&P 500 0.49%, Nasdaq 0.87%

(Updates to early afternoon)

By Uday Sampath Kumar

Sept 11 (Reuters) - Wall Street rose on Wednesday, boosted

by Apple Inc after the launch of its latest iPhones, while

investor nerves were also soothed by China's move to ease trade

tensions with the United States.

Shares of the Silicon Valley giant AAPL.O rose 2.79%, as

it also rolled out a streaming TV service at a price that

undercuts Walt Disney Co DIS.N and Netflix Inc NFLX.O .

The gains took Apple's market valuation above $1 trillion

and lifted the wider technology sector .SPLRCT by 0.78%, the

biggest boost among the 11 major S&P 500 sectors.

Tech stocks bounced from a drop in the previous session,

which saw investors moving to more value-oriented stocks from

growth shares.

Phil Orlando, chief equity market strategist at Federated

Investors, said he believed investors will likely continue to

move money into sectors like financials and energy, as well as

small cap stocks, which have all underperformed this year.

Adding to the positive momentum, China's finance ministry

moved to exempt 16 types of U.S. goods, including lubricants and

some animal feed ingredients, from additional retaliatory

tariffs, ahead of a planned meeting between trade negotiators.

While on the surface, the move is seen as a friendly gesture

to thaw relations with the United States, analysts are skeptical

about how much it will move the needle in resolving a protracted

trade war that has hurt the global economy.

The nature of the goods that are being exempted are staples

and indicates that China's decision is likely more to do with

supporting its own economy rather than extending an olive branch

to the United States, Ed Egilinsky, head of alternative

investments at Direxion said.

"There's a big difference between today's move and sitting

down at the negotiating table and actually ironing out a deal."

Comments from a senior White House adviser on Tuesday urging

investors to be patient about resolving the dispute further

downplayed expectations that a trade deal would be agreed this

year. Investors held out on big bets ahead of stimulus decisions

from central banks to stem a global slowdown in economic growth.

The U.S. Federal Reserve and the European Central Bank are

expected to cut interest rates at their policy meetings over the

next two weeks.

U.S. President Donald Trump on Wednesday renewed his attacks

on Fed Chairman Jerome Powell, saying that the central bank

should get interest rates down to "ZERO, or less".

While the domestic economy is well insulated from

uncertainties like Brexit that are dragging on European markets,

U.S. investors will react negatively on Thursday in the event

that the ECB puts out a more hawkish policy decision than

expected, Orlando said.

At 1:05 p.m. ET, the Dow Jones Industrial Average .DJI was

up 105.55 points, or 0.39%, at 27,014.98, the S&P 500 .SPX was

up 14.57 points, or 0.49%, at 2,993.96 and the Nasdaq Composite

.IXIC was up 70.16 points, or 0.87%, at 8,154.31.

Shares of Micron Technology Inc MU.O rose 1.8% after

Longbow Research upgraded its stock to "buy". Baker Hughes BHGE.N fell 4.5%, the most among S&P 500

companies, after parent General Electric GE.N looked to sell a

majority stake in the oilfield services provider.

Advancing issues outnumbered decliners for a 2.11-to-1 ratio

on the NYSE and a 2.58-to-1 ratio on the Nasdaq.

The S&P index recorded 22 new 52-week highs and no new low,

while the Nasdaq recorded 45 new highs and 11 new lows.

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