US stocks close sharply higher on Trump China comments; Broadcom surges
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Traders work on the floor of the New York Stock Exchange on Oct 13.
PHOTO: AFP
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NEW YORK - Wall Street’s main indexes ended sharply higher on Oct 13, led by gains in Broadcom and other chipmakers, after US President Donald Trump struck a conciliatory tone about renewed US-China trade tensions, easing investor worries.
Lifting sentiment, US Treasury Secretary Scott Bessent said in an interview with Fox Business Network that Mr Trump was on track to meet his Chinese counterpart
AI-related tech stocks were the biggest winners in Oct 13’s rebound. Broadcom surged almost 10 per cent after partnering with OpenAI to produce the startup’s first in-house artificial intelligence processors.
The Nasdaq notched its biggest one-day gain since May 27.
“AI continues to be the momentum driver, and it’s not surprising investors have purchased the dip,” said Mr Sam Stovall, Chief Investment Strategist at CFRA Research, adding that investors should remain cautious as long as Mr Trump’s dispute with China remains unresolved.
Wall Street tumbled on Oct 10, with the S&P 500 and Nasdaq posting their steepest weekly declines in months. The latest rupture followed China’s announcement on Oct 9 that it would dramatically expand its rare earths export controls
In retaliation, Mr Trump on Oct 10 said he would apply an additional 100 per cent tariff on imports from China and impose export controls on all critical US-made software from Nov 1.
However, over the weekend, Mr Trump said “it will all be fine” and that the US did not want to “hurt” China. China on Oct 12 blamed the US for the escalation but did not roll out further countermeasures.
Other AI-related chipmakers also gained, with Nvidia climbing 2.8 per cent and Micron Technology jumping over 6 per cent. The PHLX chip index soared almost 5 per cent.
JPMorgan Chase, Goldman Sachs, Citigroup , and Wells Fargo are set to release quarterly results on Oct 14, kicking off an earnings season that investors will watch closely for signs of how tariffs are impacting Wall Street’s largest companies.
Earnings reports will provide fresh clues on the economy at a time when major official data releases remain delayed due to an ongoing government shutdown.
Analysts on average expect S&P 500 companies’ third-quarter earnings to grow 8.8 per cent from a year ago, according to LSEG data.
The S&P 500 climbed 1.56 per cent to end the session at 6,654.72 points.
The Nasdaq gained 2.21 per cent to 22,694.61 points, while the Dow Jones Industrial Average rose 1.29 per cent to 46,067.58 points.
Ten of the 11 S&P 500 sector indexes rose, led by information technology, followed by a 2.29 per cent gain in consumer discretionary.
Following Oct 10’s steep drop and Oct 13’s partial recovery, the S&P 500 is about 1.5 per cent below its record high close reached on Oct 8.
In the Middle East, Hamas freed the last living Israeli hostages
Oracle jumped 5.1 per cent after at least two brokerages raised their price target on the AI cloud firm. Estee Lauder advanced 5.8 per cent after a report that Goldman Sachs upgraded the stock’s rating to “buy” from “neutral”. Fastenal dropped 7.5 per cent after the industrial supplies distributor missed third-quarter profit expectations.
Advancing issues outnumbered falling ones within the S&P 500 by a 2.5-to-one ratio.
The S&P 500 posted 7 new highs and 14 new lows; the Nasdaq recorded 91 new highs and 120 new lows.
Volume on US exchanges was relatively light, with 18.2 billion shares traded, compared to an average of 20.2 billion shares over the previous 20 sessions. REUTERS
