Stocks - Wall Street Rises as Chinese Capital Curbs Downplayed
Investing.com – Wall Street rose on Monday after the White House downplayed reports that it is looking into ways to limit Chinese companies from listing on U.S. stock exchanges.
The Dow rose 94 points or 0.4% by 9:51 AM ET (13:51 GMT), while the S&P 500 was up 12 points or 0.4% and the Nasdaq composite gained 34 points or 0.4%.
Treasury spokeswoman Monica Crowley told Bloomberg news on Saturday that “the administration is not contemplating blocking Chinese companies from listing shares on U.S. stock exchanges at this time.”
Wall Street ended in the red on Friday following reports that the U.S. was going to curb Chinese companies' access to U.S. markets.
White House trade adviser Peter Navarro dismissed the reports on Monday as "fake news." Other measures that have been reported as being considered include putting caps on the weighting of Chinese companies in stock indexes managed by American companies, and limiting U.S. pension funds' exposure to Chinese firms.
"If the U.S. goes down this road, it could have some serious repercussions," said Robert Pavlik, chief investment strategist at SlateStone Wealth LLC in New York.
"It could possibly lead to the Chinese selling U.S. treasuries and could put pressure on the Treasury market, so it needs to be well thought out before being executed."
Technology stocks were higher, with Facebook (NASDAQ:FB) up 0.1% and Apple (NASDAQ:AAPL) jumping 1.4% and Tesla (NASDAQ:TSLA) up 0.5%. Bed Bath&Beyond surged 8.1% on an analyst upgrade.
Elsewhere, BP (LON:BP) fell 0.3% after Sky News reported that the company is preparing to announce the retirement of its CEO Bob Dudley.
Elsewhere, Fannie Mae (OTC:FNMA) and Freddie Mac (OTC:FMCC) both rose after the Treasury said they'll be permitted to retain a total of $45 billion in earnings going forward, as an initial step towards exiting government control.
In a joint statement, the Treasury Department and Federal Housing Finance Agency, which regulates the pair, said the new policy will allow the two to rebuild capital reserves. Under prior policy, they were only permitted to hold $3 billion in reserves, with the rest of their profits going to the government.
Elsewhere, Fannie Mae and Freddie Mac both rose after the Treasury said they'll be permitted to retain a total of $45 billion in earnings going forward, as an initial step towards exiting government control.
In a joint statement, the Treasury Department and Federal Housing Finance Agency, which regulates the pair, said the new policy will allow the two to rebuild capital reserves. Under prior policy, they were only permitted to hold $3 billion in reserves, with the rest of their profits going to the government.
In commodities, the U.S. dollar index, which measures the greenback against a basket of six major currencies, rose 0.2% to 98.993 and gold futures fell 0.9% to $1,492.30 a troy ounce. Crude oil futures lost 1.1% to $55.30 a barrel.
-Reuters contributed to this report
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