US Stocks Rise on Hopes For a Trade Deal With China
NEW YORK (AP) — U.S. stocks are rising Friday, reversing a three-day losing streak as investors digest news of a potential resolution to the U.S.'s trade war with China.
U.S. officials are reportedly preparing a deal that could be signed within a month, according to news agency Bloomberg. The trade war between the world's largest economies has raised prices for consumers and companies. It's also deepened concerns that escalating tariffs could worsen the global economy's slowdown.
President Donald Trump held off a threat to impose higher tariffs on $200 billion of Chinese products as negotiations continued. Washington accuses Beijing of stealing foreign companies' technology or pressuring them to hand it over.
Technology and bank stocks led the early gains. Retailers also rose. Gap surged on plans to spin off its Old Navy brand. Foot Locker rose after reporting strong financial results and a solid forecast.
Investors have remained confident in the strength of the U.S. economy, despite weak economic reports. Consumer spending in December took its biggest tumble in nine years.
Disappointing retails sales was another sign that growth slowed at the end of 2018.
KEEPING SCORE: The Dow Jones Industrial Average rose 90 points, or 0.4 percent, to 26,008 as of 10:45 a.m. The S&P 500 index and Nasdaq composite were up 0.5 percent.
OLD NAVY SAILING AWAY: Gap surged 18 percent after it told investors it will spin off its Old Navy brand into a separate company. The retailer will retain its namesake brand, along with Banana Republic and others, in a new, yet to be named company.
The split comes as Old Navy has thrived while Gap struggles with increasing competition from the likes of Target and Amazon.
RUNNING START: Foot Locker jumped 8 percent after the footwear and athletic apparel retailer blew past investor expectations for the fourth quarter. The company also expects double-digit profit growth in 2019.
By AP reporter Damian J. Troise