US stocks rise for 4th straight day on trade deal hopes

Traders work on the floor of the New York Stock Exchange.
Traders work on the floor of the New York Stock Exchange.PHOTO: EPA-EFE

NEW YORK (AFP) - Wall Street stocks rose for the fourth straight session on Friday (Jan 18) , closing out a strong week on optimism over US-China trade talks, despite sharp drops in Netflix and Tesla Motors.

The Dow Jones Industrial Average climbed 1.4 per cent to 24,706.35. The blue-chip index has risen more than 13 per cent since Dec 24.

The broad-based S&P 500 gained 1.3 per cent to 2,670.71, while the tech-rich Nasdaq Composite Index advanced 1 per cent to 7,157.23.

The closes marked the fourth straight weekly gains for the Dow and S&P and the third for the Nasdaq.

Analysts said the gains reflected a continuation of the optimism following a report on Thursday that the United States was considering lifting tariffs on China as a step to win a broader trade agreement.

After a bruising December, US stocks have been in rally mode in early 2019 amid optimism on trade and relief at Federal Reserve commentary suggesting a cautious approach to further interest rate hikes.

There's "definitely rising optimism" of a trade deal, said LBBW's Karl Haeling.

"There are kind of smoke signals and when there is smoke there is fire," Haeling said.

"It seems that Trump sees the weakening of the economy and the shutdown situation. He seems to be doing something to get a win here."

Shares of US companies with significant China operations gained, including Dow member Boeing, Caterpillar and Nike.

The positive tone on the China talks also helped Tiffany, which jumped 5.4 per cent despite releasing lacklustre holiday sales figures.

"The health of the Chinese consumer is integral to Tiffany's financial performance," said a note from

"Therefore, any progress made towards a resolution on trade with China would represent a significant positive development for the company and its stock.

But Tesla Motors dived 13 per cent after the electric car maker announced plans to cut seven percent of its workforce and forecast lean profits.

Netflix fell 4 per cent as its profits topped analyst expectations but analysts worried that subscriber growth was slowing.