US STOCKS-Wall Street rebounds as tariff delay prompts rally

Reuters

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    * Tech leads all 3 major averages higher
    * Apple jumps on announced tariff deal
    * Treasury yields edge up, lifting bank stocks 
    * Indexes up: Dow 1.53%, S&P 1.59%, Nasdaq 1.96%

 (Updates prices to late afternoon, changes dateline, byline)
    By Stephen Culp
    NEW YORK, Aug 13 (Reuters) - Wall Street rose on Tuesday
after the Trump administration announced a delay on select
Chinese import tariffs, bringing buyers back to the equities
market in a broad-based rally.
    Tech shares, led by Apple Inc  AAPL.O , pulled all three
major U.S. indexes higher on the news, easing fears over the
contentious U.S.-China trade war and growing signs of imminent
recession.
    U.S. Trade Representative Robert Lighthizer said the United
States would hold off on implementing additional 10% tariffs on
key Chinese goods, including laptops and cell phones, tariffs
that were originally set to go into effect next month.
 urn:newsml:reuters.com:*:nL2N2590HM
    "The bargain hunters stepped in after that announcement,"
said Robert Pavlik, chief investment strategist, senior
portfolio manager at SlateStone Wealth LLC in New York. 
    But Pavlik warned against too much optimism.
    "You really don't know where any of this is headed, Pavlik
added. "If these (trade) talks don't show some progress, people
are worried what it may bring: rising costs and a global
slowdown."
    "It's very reminiscent of when we were in Vietnam and the
U.S. was in talks about ending the war and you'd get periods of
high hopes followed by crushing blows."  
    Apple, a likely beneficiary of the tariff delay, rose 4.5%,
while the Philadelphia SE Semiconductor Index  .SOX  gained
2.8%.
    In economic news, U.S. consumer prices  USCPFY=ECI 
accelerated in July, with core CPI, which strips out volatile
food and energy prices, growing at 2.2% year-on-year, its
largest gain in six months and well above the U.S. Federal
Reserve's 2% target.  urn:newsml:reuters.com:*:nL2N2581H9
    The healthy inflation reading is unlikely to change market
expectations for an additional interest rate cut from the Fed
next month as it grapples with the trade war between the world's
two largest economies and its economic fallout.
    U.S. Treasury yields rose as market participants' risk
appetite improved in the wake of Monday's bond market rally,
sending the financial sector  .SPSY  1.6% higher.  urn:newsml:reuters.com:*:nL2N2590D1 
    The Dow Jones Industrial Average  .DJI  rose 395.48 points,
or 1.53%, to 26,302.85, the S&P 500  .SPX  gained 45.75 points,
or 1.59%, to 2,928.84 and the Nasdaq Composite  .IXIC  added
154.46 points, or 1.96%, to 8,017.87.
    All of the 11 major sectors in the S&P 500 were trading in
the black, with technology  .SPLRCT , communications services
 .SPLRCL  and consumer discretionary  .SPLRCD  seeing the
biggest percentage gains.
    Shares of CBS Corp  CBS.N  and Viacom Inc  VIAB.O  were both
up 2.7% after sources familiar with the matter told Reuters the
media companies had reached an agreement in principle regarding
their impending merger.  urn:newsml:reuters.com:*:nL4N25931O 
    Second-quarter earnings season has reached the final
stretch, with 453 of the companies in the S&P 500 having posted
results. Of those, 73.3% have come in above consensus estimates,
according to Refinitiv data.
    Analysts see S&P 500 second-quarter earnings growth of 2.9%
year-on-year, significantly higher than the paltry 0.3% growth
expected on July 1, per Refinitiv. 
    Advancing issues outnumbered declining ones on the NYSE by a
2.77-to-1 ratio; on Nasdaq, a 2.22-to-1 ratio favored advancers.
    The S&P 500 posted 24 new 52-week highs and 18 new lows; the
Nasdaq Composite recorded 51 new highs and 112 new lows.  
     

 (Reporting by Stephen Culp; Editing by Lisa Shumaker)
 ((stephen.culp@thomsonreuters.com; 646-223-6076;))

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