US STOCKS-Wall Street advances on renewed trade deal optimism

Reuters

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    * Beijing open to partial trade deal - BBG
    * China offering extra U.S. agriculture purchases - FT
    * Apple, Microsoft biggest boosts to S&P 500
    * J&J drops after jury says company must pay $8 bln in
damages
    * Indexes up: Dow 0.79%, S&P 500 1.01%, Nasdaq 1.13%

 (Updates to late afternoon, changes dateline, byline)
    By Stephen Culp
    Oct 9 (Reuters) - Tech stocks led Wall Street into the black
on Wednesday, capping a three-day losing streak as a report that
China was open to a partial deal heartened investors ahead of
high-level trade negotiations.
    All three major U.S. stock averages were higher, with
Microsoft  MSFT.O  and Apple Inc  AAPL.O  providing the biggest
lift to the benchmark S&P 500.
    Trade-sensitive chipmakers advanced, with the Philadelphia
SE Semiconductor index  .SOX  rising 2.1%.
    China remains open to agreeing to a partial trade deal with
the United States, despite the inclusion of top Chinese
artificial intelligence startups in a trade blacklist, according
to a Bloomberg report.  urn:newsml:reuters.com:*:nFWN26T0UF
    Separately, the Financial Times said Beijing was offering to
increase its annual purchases of U.S. agricultural products.
 urn:newsml:reuters.com:*:nL5N26U2XD
    "A partial deal with China would at least pave the way for a
larger deal down the road," said Tim Ghriskey, chief investment
strategist at Inverness Counsel in New York. "Every day we get a
different tweet and the market takes a different direction.
Today is an up day on a favorable tweet."
    Minutes from the U.S. Federal Reserve's most recent meeting
showed most policymakers supported the need for an interest rate
cut last month, and while all were generally more concerned with
risks associated with the U.S.-China trade war, slowing global
growth among other geopolitical issues, they differed on what
that meant for the U.S. economy.  urn:newsml:reuters.com:*:nFOM9LEF6J
    "The outlook remains challenging because of the general
economy, which is being impacted by tariffs," Ghriskey added.
"Therefore, unless we see a trade deal, the probability of the
Fed lowering rates again at the October meeting is high."  
    Trade tensions, efforts to impeach President Donald Trump,
signs of slowing economic growth and rising geopolitical
tensions have gripped equity markets so far this month, with the
S&P 500 and Dow Jones indexes off about 2% since the end of
September.
    The Dow Jones Industrial Average  .DJI  rose 205.69 points,
or 0.79%, to 26,369.73, the S&P 500  .SPX  gained 29.25 points,
or 1.01%, to 2,922.31 and the Nasdaq Composite  .IXIC  added
88.56 points, or 1.13%, to 7,912.34.
    All 11 major sectors of the S&P 500 were higher, with
technology  .SPLRCT  and financials  .SPSY  enjoying the largest
percentage gains. 
    Microsoft  MSFT.O  led the Dow's gain, rising 2.0%, while
Johnson & Johnson  JNJ.N  was the blue-chip index's sole
decliner.
    The drugmaker's shares dropped 2.3% after a jury awarded $8
billion in punitive damages in a case surrounding its
antipsychotic drug Risperdal.  urn:newsml:reuters.com:*:nL2N26T1UL
    With third-quarter earnings season coming into focus,
analysts now expect earnings for S&P 500 companies to contract
by 3.1% from a year earlier.
    Advancing issues outnumbered declining ones on the NYSE by a
2.23-to-1 ratio; on Nasdaq, a 1.58-to-1 ratio favored advancers.
    The S&P 500 posted 12 new 52-week highs and 11 new lows; the
Nasdaq Composite recorded 8 new highs and 98 new lows.  

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

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