US stocks end at records, completing comeback from tariff rout
Traders working on the floor of the New York Stock Exchange, in New York City, on June 27. REUTERS
US stocks end at records, completing comeback from tariff rout
NEW YORK - Wall Street stocks finished at fresh records on June 27 as markets cheered the latest progress in US-China trade negotiations, completing a comeback from a spring swoon due to President Donald Trump's tariffs.
Both the S&P 500 and Nasdaq finished at all-time highs following a roller-coaster session that included a stint in negative territory after Mr Trump announced he was breaking off trade talks with Canada, rupturing a series of largely positive headlines on trade.
The broad-based S&P 500 finished up 0.5 per cent at 6,173.07, while the tech-rich Nasdaq Composite Index also climbed 0.5 per cent to 20,273.46. Both represent fresh closing records.
The Dow Jones Industrial Average jumped 1 per cent to 43,819.27.
Stocks were solidly positive through early afternoon when Mr Trump blasted Canada's digital services tax in a social media post that called the country 'very difficult' to trade with.
Mr Angelo Kourkafas, of Edward Jones, said the Canada statements highlighted the potential for further volatility with the approach of a July 9 trade negotiation deadline.
'Today's headline about Canada is another reminder that as we get closer to July 9th there are catalysts for some volatility,' Mr Kourkafas said.
But Mr Tom Cahill, chief investment officer at Ventura Wealth Management, said other trade news developments in recent days had been positive, including that Washington and Beijing confirmed finalising a framework to move forward on trade.
'The news has been incrementally more positive since April on the trade front,' Mr Cahill said.
The S&P 500 last hit a record in February, but began to come under pressure thereafter as Mr Trump began to sharpen his rhetoric on trade. This culminated with Trump's April 2 'Liberation Day' vow to implement steep new levies on all trading partners.
Mr Trump has since suspended the most onerous elements of his trade overhaul, while still implementing the biggest US tariffs imposed in decades.
That has raised concerns about inflation. The personal consumption expenditures price index climbed 2.3 per cent in May from a year ago, according to data released on June 27. This was in line with analyst expectations and a slight acceleration from April's 2.2 per cent increase.
But Mr Cahill said the tariffs have thus far not resulted in significant inflationary pressures, raising hopes about Federal Reserve easing.
'Now the market is starting to anticipate a Fed rate cut in September,' said Mr Cahill, who also pointed to the boom in artificial intelligence investment as a driver of equity market momentum. AFP
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