Walmart leads gains for US stock indexes

Irving Hamilton
August 19, 2018

"China's complaint escalates the trade skirmish to the next level, which continues to be a drag on the markets as it has been over the last couple of months".

Wall Street stocks ended on Thursday on a strong note, buoyed by hopes that the first trade talks between China and the United States in months could make progress toward ending the trade war between the world " s two biggest economies.

The Dow Jones Industrial Average rose 396.32 points, or 1.58 per cent, to 25,558.73, the S&P 500 gained 22.32 points, or 0.79 per cent, to 2,840.69 and the Nasdaq Composite added 32.41 points, or 0.42 per cent, to 7,806.52. The sector was led higher by a 2.3 percent rise in Caterpillar Inc (CAT.N) shares.

Chinese and USA negotiators are planning talks to resolve their trade row ahead of meetings in November, the Wall Street Journal reported on Friday. Over the week, it lost 0.12 percent as Turkey's financial crisis weighed on the market.

"It shows that the market is being held back by trade concerns and if those were to be alleviated, the strong economic data and strong corporate profits could lift the USA stock market to all-time highs", said Chris Zaccarelli, chief investment officer at Independent Advisor Alliance in Charlotte, North Carolina.

Also boosting sentiment was a fresh signal from Walmart that USA shoppers were confident and in a spending mood. The company's online sales jumped 40 percent, and its overall sales rose at the fastest rate in more than a decade in its latest quarter.

The Russell 2000 is up 150.24 points, or 9.8 percent.

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The broader Topix index of all First Section issues on the Tokyo Stock Exchange, meanwhile, gained 10.38 points, or 0.62 percent, to finish at 1,697.53.

Cisco rose 4.6 percent after posting quarterly results and first-quarter sales forecast that topped Wall Street expectations. A $10,000 investment in the large-company stock index at the start of the bull would now be worth $42,000.

Second-quarter earnings have been stronger than expected, with 79.3 percent of the 463 S&P 500 that have reported so far beating analyst expectations, according to Thomson Reuters I/B/E/S.

Tokyo shares made moderate gains on Friday, encouraged by overnight gains on Wall Street as investors took heart from news that the USA and China will resume trade talks.

Meanwhile, Beijing has lodged a complaint to the World Trade Organization to help determine the legality of USA tariff and subsidy policies.

"Any hopes of some sort of an agreement would relieve worries of a trade war and the markets would be able to focus on the macro news and earnings".

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