U.S. Stocks Open Higher
By Georgi Kantchev
U.S. stocks edged higher Thursday amid signs that U.S. President Donald Trump's tariff plans might be softened, with exemptions for key trading partners.
The Dow Jones Industrial Average rose 127 points, or 0.5%, to 24928 shortly after the opening bell. The S&P 500 added 0.3% and the Nasdaq Composite advanced 0.4%.
Global stocks have bounced higher in recent sessions as investors have kept a close eye on developments on the Trump administration's proposed tariffs on steel and aluminum imports.
The president is expected to sign a decree this week laying out his plans, although they are expected to spare Canada and Mexico -- -two major trading partners for the U.S. -- following debate within the White House and on Capitol Hill. The narrowing of the planned tariffs have helped stocks regain ground in recent sessions, with the S&P 500, Dow industrials and Nasdaq all on track to post weekly advances.
Still, investors say volatility, which spiked in February on concerns about rising inflation, will remain elevated as details about the trade plan continue to trickle out.
"We're generally in a more volatile environment and the market will be sensitive to any headlines," said Randy Warren, chief investment officer of Philadelphia-based Warren Financial.
The U.S. trade moves come as the global economy is experiencing a rare spurt of synchronized growth. That underpinned gains in stock markets last year and at the beginning of 2018.
"The underlying thesis of a strong economy and solid earnings is still rock solid," Mr. Warren said. "The market doesn't like trade wars or anything that could change that thesis."
Elsewhere, the European Central Bank left interest rates unchanged Thursday but dropped a pledge to accelerate its bond purchases if the economy deteriorates. That step was expected by some analysts who see it as a further step toward monetary policy normalization.
The change is "further indication that QE [quantitative easing] is coming to an end this year," Claus Vistesen, chief Eurozone economist at Pantheon Macroeconomics, said in a note.
The euro fell 0.2% against the U.S. dollar following the ECB's announcement, while the Stoxx Europe 600 rose 0.7%, supported by a rally in technology shares.
Government bonds strengthened Thursday, with the yield on the benchmark 10-year U.S. Treasury note at 2.866%, according to Tradeweb, compared with 2.883% Wednesday. Yields fall as bond prices rise.
Earlier, stocks in Asia broadly closed higher. Japan's Nikkei Stock Average rose 0.5%, while South Korea's Kospi Composite extended gains from earlier in the week and added 1.3%.
Akane Otani and Ese Erheriene contributed to this article.
Write to Georgi Kantchev at email@example.com
(END) Dow Jones Newswires
March 08, 2018 10:10 ET (15:10 GMT)Copyright (c) 2018 Dow Jones & Company, Inc.