US stocks gain on ECB stimulus, trade war moderation

Wall Street advanced on Thursday, lifted by positive developments on the US-China trade front and a promise of continued stimulus from the European Central Bank.
Traders work before the closing bell at the New York Stock Exchange.
Traders work before the closing bell at the New York Stock Exchange.PHOTO: AFP

NEW YORK (AFP) - Wall Street stocks finished higher on Thursday (Sept 12) after the European Central Bank announced new stimulus measures and as investors greeted further signs of moderation in the US-China trade war.

The ECB moves bolstered expectations the US Federal Reserve will take another step to protect economic growth next week with a second interest rate cut.

The Dow Jones Industrial Average ended the day at 27,182.45, up 0.2 per cent, increasing for the seventh straight session.

The broad-based S&P 500 climbed 0.3 per cent to close the session at 3,009.57, while the tech-rich Nasdaq Composite Index also advanced 0.3 per cent to 8,194.47.

Markets were in positive territory virtually the entire day but pulled back from session highs in the last half hour of trading after flirting with records.

"We're swinging back into normal territory with the focus back on trade and monetary policy," said Art Hogan, chief market strategist at National Securities.

In a highly-anticipated move, the ECB cut a key interest rate deeper into negative territory, and announced new net purchases of government and corporate debt and support for struggling banks as outgoing chief Mario Draghi urged eurozone governments to spend more.

The ECB announcement came after President Donald Trump pushed back a round of tariff increases on China from Oct 1 to Oct 15 after Beijing agreed to spare some US products from its retaliation.

US Treasury Secretary Steven Mnuchin said trade negotiators are seeking "meaningful progress" with China in October talks.

Previous rounds of talks have failed to yield agreement.

Among individual companies, Oracle slumped 4.3 per cent as quarterly revenues lagged analyst estimates and the software giant announced that one of its two chief executive officers, Mark Hurd, was taking a medical leave of absence.