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Markets closed higher on Friday following positive comments from President Trump regarding a resolution of the U.S.-China trade war. Meanwhile, the Commerce Department reported that the administration was considering imposing fresh import tariffs on countries engaging in currency manipulation practices.
The three major benchmarks closed in the green on Friday. However, the benchmarks posted record losses for the week. Markets were closed on Monday in observance of the Memorial Day.
The Dow Jones Industrial Average (DJI) increased 0.4%, to close at 25,585.69. The S&P 500 increased 0.1% to close at 2,826.06. The tech-laden Nasdaq Composite Index closed at 7,637.01, gaining 0.1%. The fear-gauge CBOE Volatility Index (VIX) decreased 1.2% to close at 16.71. Advancers outnumbered decliners on the NYSE by a 4.95-to-1 ratio. On Nasdaq, a 3.94-to-1 ratio favored advancing issues.
How Did the Benchmarks Perform?
The Dow amassed 95.2 points to close in the green. Gains for the 30-stock index were broad based and supported by a rally in the shares of Boeing BA and Chevron CVX, which gained 1.2% and 0.7%, respectively. Both the stocks carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The S&P 500 added 3.8 points to end in positive territory. Of the 11 major sectors of the S&P 500, eight ended in green, with financials and materials stocks leading the advancers. The Financial Select Sector SPDR Fund (XLF) and Materials Select Sector SPDR Fund (XLB) increased 0.8% and 0.6%, respectively on Friday.
Meanwhile, the Nasdaq rallied 75.9 points to close in the green. Shares of Facebook FB and Netflix NFLX gained 0.1% and 0.6%, respectively and supported gains for the Nasdaq.
Trump Says Huawei Might Be Part of the Trade Deal
Per a Reuters report on May 23, President Trump stated that concerns which the United States has about Huawei Technologies might be resolved as part of a trade deal with China. However, Trump maintained that the telecom equipment manufacturer from China was “very dangerous” from the point of view of national security.
Last week, the Trump administration had banned U.S. companies from any dealings with Huawei before providing some of the companies a 90-day reprieve from the ban. Consequently, for the better part of the week, investors speculated than an extended trade war between the two countries would weigh heavily on markets. However, positive comments from Trump boosted gains for markets on Friday.
A Fresh Spate of Tariffs
The U.S. Department of Commerce stated on May 23 that the Trump administration was considering levying tariffs on imports from countries which have engaged in currency manipulation. The administration believes this puts America at a competitive disadvantage.