The S&P 500 and the Dow industrials ended little changed on Friday, hitting record highs in the session, as the US and China announced an initial trade agreement, cooling tensions that have rattled markets.
The S&P 500 technology sector and the tech-heavy NASDAQ finished solidly in positive territory, with gains in Apple Inc providing a boost.
Trading was choppy following announcement of the agreement, which reduces some US tariffs in exchange for increased Chinese purchases of US farm goods.
The US has agreed to suspend tariffs on US$160 billion in Chinese goods that were due to take effect today, a deadline that had been closely watched by investors.
“The risk of trade [dispute] escalation has been averted for now, and that’s a positive,” said Sunitha Thomas, regional portfolio adviser at Northern Trust Wealth Management in Chicago.
Investors were also digesting British Prime Minister Boris Johnson’s commanding victory in general elections, which could bring more clarity to the country’s planned exit from the EU.
“We got confirmation today that two major risks that have been weighing on the market all year have been lifted, for now at least,” Thomas said.
“The market is not up more, because we have had some of the rally coming into it, and I think there is now a recognition that there needs to be policy follow-through on the negotiation of Brexit and also what really the details of this deal between China and the US are,” Thomas said.
The Dow Jones Industrial Average on Friday rose 3.33 points, or 0.01 percent, to 28,135.38, the S&P 500 gained 0.23 points, or 0.01 percent, to 3,168.8 and the NASDAQ Composite added 17.56 points, or 0.2 percent, to 8,734.88.
For the week, the S&P 500 rose 0.7 percent, its ninth increase out of the past 10 weeks, the Dow gained 0.4 percent and the NASDAQ added 0.9 percent
Utilities led gains among the S&P 500 sectors on Friday along with tech, while energy and materials lagged.
Improving sentiment about trade tensions, interest rate cuts from the US Federal Reserve and encouraging economic data have fueled records for the major US stock indices. The benchmark S&P 500 has gained 26 percent so far this year.
Earlier this week, the Fed signaled borrowing costs would not change anytime soon.
In company news, Adobe Inc shares rose 3.9 percent after it beat Wall Street estimates for fourth-quarter revenue and profit.
Broadcom Inc shares dropped 3.8 percent after the company provided a lukewarm revenue forecast for next year.
Oracle Corp shares fell 3.5 percent after its revenue fell short of quarterly estimates.
Advancing issues outnumbered declining ones on the New York Stock Exchange by a 1.19-to-1 ratio; on NASDAQ, a 1.07-to-1 ratio favored decliners.
The S&P 500 posted 76 new 52-week highs and one new low; the NASDAQ Composite recorded 128 new highs and 49 new lows.
About 7.4 billion shares changed hands in US exchanges on Friday, above the 6.8 billion-share daily average over the past 20 sessions.
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