US STOCKS-Tech stocks lead rally on Wall Street after Huawei breather

Reuters

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    * U.S. eases restrictions on China's Huawei
    * Philadelphia Chip Index set to snap 3-day losing streak
    * Kohl's, J.C. Penney tumble as same-store sales disappoint
    * Indexes up: Dow 0.60%, S&P 0.85%, Nasdaq 1.08% 

 (Updates prices, adds comments)
    By Shreyashi   Sanyal
    May 21 (Reuters) - U.S. stocks rose on Tuesday, lifted by a
rebound in technology stocks, as Washington's move to
temporarily ease curbs on China's Huawei Technologies calmed
nerves over a further worsening of a trade war between the two
countries.  
    Chipmakers, which bore the brunt of Monday's sell-off, rose
after the United States granted the Chinese telecoms equipment
maker a license to buy U.S. goods until Aug. 19.  urn:newsml:reuters.com:*:nL2N22W19U
    The Philadelphia Semiconductor Index  .SOX  gained 2.27% and
was on track to end a three-day slump. Shares of Huawei
suppliers such as Intel Corp  INTC.O , Qualcomm Inc  QCOM.O ,
Xilinx Inc  XLNX.O  and Broadcom Inc  AVGO.O  rose between 2.4%
and 4%. 
    The broader S&P 500 technology sector  .SPLRCT  rose 1.33%,
the most among the 10 major S&P sectors trading higher. 
    "The latest news on Huawei shows that there is still room
for trade negotiations with China," said Aaron Clark, portfolio
manager at GW&K Investment Management. 
    "Technology stocks have been at the forefront of
trade-related news and particularly semiconductors have faced
some pain points, more so than others."      
    U.S. President Donald Trump added Huawei  HWT.UL  to a trade
blacklist last week, leading several companies to suspend
business with the world's largest telecom equipment maker and
triggering fears of a rippling effect on the global technology
sector. 
    Reuters reported on Sunday that Alphabet Inc's  GOOGL.O 
Google would stop providing Huawei access to its proprietary
apps and services. But Huawei said on Tuesday it was working
closely with the U.S. company to resolve the restrictions.
 urn:newsml:reuters.com:*:nL5N22X36N
    The S&P 500 index  .SPX  is now 3% away from its all-time
high scaled earlier in May, hit by recent selling pressure on
mounting concerns about a prolonged U.S.-China trade war. Still,
the benchmark index is set to post its worst monthly decline
this year.  
    At 11:09 a.m. ET, the Dow Jones Industrial Average  .DJI 
was up 155.07 points, or 0.60%, at 25,834.97. The S&P 500 was up
24.02 points, or 0.85%, at 2,864.25 and the Nasdaq Composite
 .IXIC  was up 83.46 points, or 1.08%, at 7,785.84.
    The defensive consumer staples  .SPLRCS  was the only major
S&P sector trading lower, down 0.16%. 
    Investors also largely shrugged off disappointing results
from a handful of retailers.
    Kohl's Corp  KSS.N  plunged 11%, the most among S&P 500
companies, after the department store operator cut its full-year
profit forecast and reported quarterly same-store sales and
profit that missed expectations.  urn:newsml:reuters.com:*:nL4N22X2XB  
    Rival J.C. Penney Co Inc  JCP.N  fell 9.1% after the company
reported a bigger-than-expected fall in quarterly
comparable-store sales.  urn:newsml:reuters.com:*:nL4N22X2XH
    Home Depot Inc  HD.N  shares dipped 0.1% after the home
improvement chain reported its slowest growth in quarterly
same-store sales in at least three years. urn:newsml:reuters.com:*:nL4N22X2TB      
    With over 460 of S&P 500 companies having posted
first-quarter results, 75.2% have topped analysts' profit
expectations. Analysts now expect first-quarter earnings growth
of 1.4%, a sharp turnaround from the 2% loss expected on April
1, according to Refinitiv data.
    Advancing issues outnumbered decliners by a 4.31-to-1 ratio
on the NYSE and by a 2.91-to-1 ratio on the Nasdaq.
    The S&P index recorded 26 new 52-week highs and four new
lows, while the Nasdaq recorded 41 new highs and 46 new lows.

 (Reporting by Shreyashi Sanyal and Sruthi Shankar in Bengaluru;
Editing by Arun Koyyur and Sriraj Kalluvila)
 ((Shreyashi.Sanyal@thomsonreuters.com; +1 646 223 8780 ;
Reuters Messaging:
Shreyashi.Sanyal.thomsonreuters.com@reuters.net))

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