US stocks gain again on optimism over trade, budget talks

A monitor displays stock market information on the floor of the New York Stock Exchange. (Bloomberg pic)

NEW YORK: Wall Street stocks rose again early Wednesday, extending an upward push on optimism over US-China trade talks and a preliminary budget agreement in Washington.

About 20 minutes into trading, the Dow Jones Industrial Average was up 0.7% at 25,612.62.

The broad-based S&P 500 gained 0.6% to 2,761.19, while the tech-rich Nasdaq Composite Index advanced 0.5% to 7,452.50.

US equity indices rose about 1.5% on Tuesday after President Donald Trump said he could extend the deadline on new China tariffs and downplayed the odds of another government shutdown over border security funding.

The advance also came as US data showed inflation in January rose at the slowest pace in 19 months. analyst Patrick O’Hare said the early gains on Wednesday reflected positive momentum and investor fear at missing out on further gains.

O’Hare said the lift from the US budget situation illustrates the “dysfunctional” nature of Washington.

“The trading excitement over avoiding another government shutdown is like getting excited over the idea that your bank is going to be open for business on a Wednesday,” he said in a note posted to the financial website.

“That’s not a surprise. It’s a normal course of business for banks to be open on a Wednesday.”