Stocks finished firmly higher on Thursday, as investors digested updates on the trade front. A report revealed Washington and Beijing had reached a phase-one deal in principle that awaited President Trump’s approval. The agreement is widely expected to delay U.S. tariffs that are set to take place on December 15, and reduce existing duties. The Dow rallied 220 points, closing within 0.1% of its all-time high. The S&P 500 jumped 0.9%, and the Nasdaq Composite climbed 0.7%, to send both indexes to their first record levels since November 27.
Amid the risk-on mood, perceived safe-haven assets retreated. Treasuries posted their largest decline since mid-September, with the yield on the 10-year note jumping ten basis points to 1.89%. COMEX gold slipped 0.1% to $1,468.50/ounce.
Seven of 11 S&P 500 sectors ended the session in positive territory. The Financials group paced the gains, jumping 2%, amid a spike in Treasury yields. Energy also outperformed as WTI crude added 1.1% to $59.42/barrel. Meanwhile, the Communication Services sector was weighed down by Facebook’s 3% decline amid news the FTC may seek a preliminary injunction against the social media giant, with federal officials citing antitrust concerns.
In central bank news, both the European Central Bank and Federal Reserve left respective key rates unchanged in policy decisions this week. Fed Chair Jerome Powell reiterated on Wednesday that the current state of policy is likely to remain appropriate. On the data front, initial jobless claims jumped to a two-year high to 252,000. Separately, core producer price index (ex-food and energy), dipped to 1.3% year-over-year.