NEW YORK: Wall Street shrugged off trade war worries on Wednesday, with strong gains by banking shares lifting the Dow and the Nasdaq closing at a record for the third straight session.
The Dow Jones Industrial Average jumped 1.4 percent at 25,146.39.
The broad-based S&P 500 gained 0.9 percent to 2,772.35, while the tech-rich Nasdaq Composite Index gained 0.7 percent to 7,689.24.
Bank shares were propelled by remarks from a top European Central Bank official that the bank would meet next week to discuss when to wind down a massive stimulus program.
Analysts said the comments confirmed a process of monetary tightening, lifting US Treasury yields and boosting expectations that banks would make more money from higher interest rates.
JPMorgan Chase, Citigroup and Bank of America all won at least two percent.
US stocks have been pressured for weeks by worries over trade conflict following a number of aggressive moves by President Donald Trump’s administration, some of which have triggered retaliation from Mexico and other trading partners.
At the same time, there has been a school of thought in the market that Trump’s harsh rhetoric on trade is part of a bargaining strategy and that the impact of US actions may not be all that significant.
Canadian Prime Minister Justin Trudeau said he expects “frank and sometimes difficult” conversations with US President Donald Trump on US tariffs at this week’s G7 summit in Quebec.
On Wednesday, Dow companies linked to international trade were among the strongest gainers, with Caterpillar winning 2.3 percent and Boeing 3.1 percent.
Another outperformer was Tesla Motors, which soared 9.7 percent as chief executive Elon Musk expressed confidence that the company would reach production targets for its Model 3 sedan.
But Delta Air Lines fell 0.9 percent after it lowered its second-quarter earnings projections due to the hit from higher fuel prices.
Source: Brecorder
