US stocks have closed higher with the S&P 500 and the Dow Jones Industrial Average extending gains and the Nasdaq turning positive on reports of progress in tariff disputes between the United States and its trading partners China and Mexico.
Chinese and US negotiators are planning talks to resolve their trade row ahead of meetings in November, the Wall Street Journal reported on Friday.
Additionally, Mexico’s Economy Minister Ildefonso Guajardo said he hoped to wrap up outstanding bilateral issues on the North American Free Trade Agreement by the middle of next week.
‘The threat of a trade war threatens economic activity,’ said Stephen Massocca, senior vice president at Wedbush Securities in San Francisco. ‘The fact that the administration might resolve (trade disputes) sooner rather than later, without a sustained time frame of slower economic actively due to tariffs, that bodes well for the market.’
Trade-vulnerable industrial stocks led advances by the S&P 500 and the Dow, with the S&P 500 industrial sector gaining 0.6 per cent. The sector was led higher by a 2.3 per cent rise in Caterpillar shares.
For the week, the S&P and the Dow posted weekly gains, but the Nasdaq showed a loss for the same period.
Following bleak forecasts, shares of Nvidia Corp and Applied Materials fell 4.9 per cent and 7.7 per cent, respectively, pushing the Philadelphia SE Semiconductor index 0.7 per cent lower.
Among the so-called FAANG group of momentum stocks, all but Apple Inc fell. The smartphone maker gained 2.0 per cent to an all-time closing high.
Netflix posted its sixth consecutive loss. In addition to Apple and Netflix, the FAANG group includes Facebook, Amazon.com and Google parent Alphabet.
Shares of Tesla dropped 8.9 per cent, their worst day in over two years after chief executive Elon Musk’s interview with the New York Times and a UBS note saying the company could lose $US6,000 ($A8,201) on every base Model 3 sedan due to powertrain costs.
The Dow Jones Industrial Average rose 110.59 points, or 0.43 per cent, to 25,669.32, the S&P 500 gained 9.44 points, or 0.33 per cent, to 2,850.13 and the Nasdaq Composite added 9.81 points, or 0.13 per cent, to 7,816.33.
Second-quarter earnings season is approaching the finish line. Of the 467 companies in the S&P 500 that have reported, 79.2 per cent have beaten consensus estimates, according to Thomson Reuters I/B/E/S.
All 11 major sectors in the S&P 500 were in positive territory.
Bucking the otherwise downbeat department store earnings trend, shares of Nordstrom jumped 13.2 per cent after posting better-than-expected same-store sales and raising its profit forecast.
Deere & Co’s shares rose 2.4 per cent after quarterly results missed analysts’ estimates due to higher raw materials and freight costs.
Advancing issues outnumbered declining ones on the NYSE by a 2.45-to-1 ratio; on Nasdaq, a 1.41-to-1 ratio favoured advancers.
The S&P 500 posted 38 new 52-week highs and 3 new lows; the Nasdaq Composite recorded 83 new highs and 69 new lows.
Volume on US exchanges was 6.06 billion shares, compared with the 6.53 billion average over the last 20 trading days.