Markets up after tariff-cut report

nullFILE- In this Jan. 11, 2019, file photo, trader Joseph Lawler, left, and specialist Mark Otto work on the floor of the New York Stock Exchange. The U.S. stock market opens at 9:30 a.m. EST on Thursday, Jan. 17. (AP Photo/Richard Drew, File)
nullFILE- In this Jan. 11, 2019, file photo, trader Joseph Lawler, left, and specialist Mark Otto work on the floor of the New York Stock Exchange. The U.S. stock market opens at 9:30 a.m. EST on Thursday, Jan. 17. (AP Photo/Richard Drew, File)

NEW YORK -- U.S. stocks climbed Thursday after The Wall Street Journal reported that U.S. officials could reduce the new tariffs on Chinese imports as part of upcoming trade negotiations between the two countries. It was the latest in a series of potentially conflicting updates on the trade dispute.

The S&P 500 index rose 19.86 points, or 0.8 percent, to 2,635.96. The Dow Jones Industrial Average jumped as much as 267 points after the report about the potential tariff cuts. It finished with a gain of 162.94 points, or 0.7 percent, at 24,370.10. The Nasdaq composite added 49.77 points, or 0.7 percent, to 7,084.46. The Russell 2000 index of smaller-company stocks climbed 12.55 points, or 0.9 percent, to 1,467.25.

Stocks wobbled earlier after reports late Wednesday that the U.S. might bring criminal charges against Chinese technology giant Huawei over allegations it stole trade secrets. However, China's government said the top trade envoys from both countries will meet in Washington at the end of this month, a possible sign of progress in negotiations.

Technology, industrial and health care companies made some of the largest gains, and makers of chemicals and other basic materials jumped.

After three months of big swings that were linked to trade talk developments, investors have adjusted to the uncertainty, said Gina Martin Adams, the chief equity strategist for Bloomberg Intelligence. She said investors want hard data and clear answers about what international trade will look like.

"These issues between Huawei and trade have been a constant source of volatility and uncertainty that is weighing on sentiment," she said. "Any permanence on the issue is going to be deemed an improvement."

Among tech companies, chipmaker Nvidia gained 1.9 percent to $151.72 and Advanced Micro Devices rose 2.6 percent to $20.25. Hard drive makers struggled, however. Western Digital lost 3.6 percent to $36.47 and Seagate shed 2.5 percent to $38.73 as digital storage companies sank.

Industrial companies also stand to benefit from greater trade and faster economic growth. Defense contractors made strong gains when President Donald Trump called for a space-based missile defense system after a strategy review by the Pentagon.

Defense contractor Northrop Grumman gained 3.3 percent to $264.08 and Lockheed Martin rose 2.4 percent to $278.80. Aerospace company Boeing advanced 2 percent to $359.09.

Elsewhere Fastenal, which makes industrial and construction fasteners, jumped 5.9 percent to $57.34 after it said customers became a bit less cautious about spending in December.

Among health care companies, drug maker AbbVie added 1.9 percent to $87.20 and medical device maker Becton Dickinson picked up 2.1 percent to $236.11 after it said it had a strong fiscal first quarter.

Like several other major financial companies, Morgan Stanley was hurt by difficulties in trading during the volatile fourth quarter. Its stock trading revenue was flat over the last three months of the year, a period where the S&P 500 dropped 14 percent, and its bond trading revenue tumbled 30 percent. Morgan Stanley fell 4.4 percent to $42.53.

Bond prices edged lower. The yield on the 10-year Treasury note rose to 2.75 percent from 2.73 percent.

Benchmark U.S. crude oil fell 0.5 percent to $52.41 a barrel in New York, while Brent crude, the international standard, gave up 0.2 percent to $61.18 a barrel in London.

Business on 01/18/2019

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