Markets closed mostly higher on Friday as President Donald Trump’s comments renewed hopes that trade disputes with China would be resolved in the near term. This gave a boost to investors’ confidence helping the Dow and the S&P 500 to rally. However, Nasdaq ended the day lower, led by a decline in chipmaker stocks.
The Dow Jones Industrial Average (DJI) advanced 0.5% to close at 25,413.22. The S&P 500 gained 0.2% to close at 2,736.27. However, the Nasdaq Composite Index closed at 7,247.87, losing 0.2%. A total of 8.18 billion shares were traded on Friday, lower than the last 20-session average of 8.61 billion shares. Advancers outnumbered decliners on the NYSE by a 1.20-to-1 ratio. On Nasdaq, a 1.03-to-1 ratio favored advancing issues.
How did the Benchmark Perform?
The Dow added 123.95 points, after Trump said that China seemed willing to resume talks to resolve trade disputes. This saw the Dow gaining as much 221 points at one time of the day. Shares of Caterpillar Inc. CAT gained 0.4%. Caterpillar has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The S&P 500 advanced 6.07 points. Gains were led by healthcare, consumer utilities, energy and real estate stocks. The Utilities Select Sector SPDR (XLV) and the Energy Select Sector SPDR (XLE) gained 1.5% and 1.2%, respectively. The Real Estate Select Sector SPDR (XLRE) gained 1.4%. However, tech stocks once again weighed on the index. The Technology Select Sector SPDR (XLK) lost 0.2%.
The tech-heavy Nasdaq lost 11.16 points, as Nvidia, Inc.’s NVDA shares plummeted on weak revenues and guidance. Shares of Nvidia, Inc. declined 18.8%.
Trump’s Comments Help Markets
On Friday, Trump told reporters that it seemed China was willing to resume talks in a move toward a possible resolution to the ongoing trade disputes with the United States. Trump also said that it may not be necessary to impose fresh tariffs or raise existing ones on Chinese imports. Trump and China’s president Xi Jinping are scheduled to meet on the sidelines of the G-20 summit to be held in Buenos Aires later this month.
Trump’s comments immediately helped lift investors’ sentiment. At one point of the day, the Dow climbed as much as 221 points. However, the gains were somewhat pared after White House officials said investors should not expect an immediate deal and that Trump only was being upbeat about the negotiations.
Chipmakers Stocks Take a Hit
On Friday, shares of Nvidia tumbled after the company released disappointing revenues and weak guidance. The chipmaker cited a decline in cryptocurrency mining as the reason behind falling sales. This saw other chipmaker stocks also taking a hit. Also, shares of Facebook Inc. FB took a beating on renewed concerns that the social media giant could face regulatory scrutiny following a New York Times report on Wednesday about the company’s efforts to avert criticism of its handling of Russian propaganda.
Stocks posted sharp weekly losses, led by a decline in tech stocks. Also, markets were hit as crude oil prices continued their downward journey. Growing concerns among investors that banks will face tighter regulations once Democrats take control of the House of Representatives added to the losses.
However, tech stocks were the second-worst performer of the week, declining 2.5%, with shares of most tech giants taking a hit. For the week, the Dow and Nasdaq declined 2.2% each, while the S&P 500 fell 1.6%.
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