US stocks surge to a record as investors breathe a sigh of relief at Trump and Xi’s trade-war truce

REUTERS/Kevin Lamarque

US stocks soared Monday following President Donald Trump and Chinese President Xi Jinping’s weekend meeting on the sidelines of the G20 summit in Japan.
The S&P 500 hit an intraday all-time high, and is on pace to close at a record.
The trade-sensitive technology sector led the market’s gains.
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On Monday, Wall Street cheered a favorable outcome in President Donald Trump and Chinese President Xi Jinping’s Saturday meeting on the sidelines of the G20 summit in Osaka, Japan.

The S&P 500 sailed to an intraday all-time high, and is on pace to close at a record.

Technology — a trade-sensitive corner of the market — led gains, followed by financial stocks. Within technology, semiconductors highly exposed to the Chinese economy posted outsized gains. Apple jumped 3%.

Major indices pared some of their gains several hours into the trading session, but the S&P 500 is still on pace above its previous record. The price of gold, a classic safe-haven asset that benefits from economic uncertainty, fell.

Here’s where the major US markets stood as of 12:25 p.m. ET:

The S&P 500 rose 0.7% to 2,962.62.
The Dow Jones Industrial Average rose 0.5% to 26,736.81.
The Nasdaq Composite jumped 1% to 8,093.66.

This bullish price action came even as investors stateside and in China digested tepid manufacturing data. Factory activity in China fell in June, according to the Caixin/Markit Manufacturing Purchasing Managers’ Index (PMI) reading released on Sunday. At 49.4, that measure’s reading that was its lowest since January.

Meanwhile June PMI data in the US on Monday showed "a further near-stagnation of operating conditions" across the country’s manufacturing landscape.

"It seems like rates and gold vols are reacting to this morning’s disappointing PMI data while equity markets are focused on the trade truce," Mandy Xu, an equity derivatives strategist at Credit Suisse, told clients on Monday.

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Some experts were skeptical Washington and Beijing’s agreement would bode well for the market in the long-term.

"Positive market reaction will be temporary," Kuniyuki Hirai, the head of trading at MUFG, the Japanese financial services firm, said in a Monday note. "The world’s two largest economies turned the clock back for only a couple of weeks as existing tariffs from US and certain retaliatory measures from China are still in effect."

Here were the biggest gainers in the S&P 500:

Wynn Resorts rose nearly 8%.
Skyworks Solutions jumped 6.4%.
Qorvo rallied 6%.

Wynn Resorts shares received a boost after the Macau gaming authority said gambling revenues jumped more than expected for the month of June. Sales of 23.8 billion patacas ($2.95 billion) topped analysts’ expectations — but fell month-over-month from May’s 25.95 billion patacas, according to a Reuters report.

Meanwhile trade-sensitive chipmakers, including Skyworks and Qorvo, soared on the back of Trump and Xi’s agreement to delay tariffs on $300 billion worth of Chinese goods.

And here were the S&P 500’s biggest losers on Monday:

Coty plunged 12%.
Freeport-McMoRan fell 5%.
Centene fell 3.5%.

The beauty company Coty, which owns brands like Covergirl, Rimmel, and Sally Hansen, said Monday it would write down about $3 billion in assets amid a broader overhaul.

Shares of Freeport-McMoRan were hammered after the mining giant said it expected to report a $0.05 per share loss in the second quarter, in part citing lower copper and gold prices.

Centene shares fell under pressure, bringing the healthcare company’s 2019 losses to 11%. Humana, the insurance company, squashed rumors in early June that it would not make a bid for Centene.

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