US stocks rise on prospect of car-tariff delay

Nasdaq MarketSite in Times Square, New York City. (Reuters pic)

NEW YORK: US stocks turned higher on the prospect that President Donald Trump will delay imposing tariffs on auto imports. Treasuries and the dollar pared gains.

The S&P 500 wiped out declines of as much as 0.7% after Bloomberg reported the president would delay by up to six months a decision on car tariffs that was due by Saturday. The tech-heavy Nasdaq 100 also rose as Treasury Secretary Steven Mnuchin added to hopes of a trade deal when he said US officials were in ‘serious’ talks with China to improve trade ties. Share fell in early trading after weak US retail and factory numbers spurred growth concerns.

Treasuries gave back gains after the two-year yield touched the lowest level since February 2018, while the 10-year rate traded around 2.38%. Oil retreated as mounting tensions in the Middle East over US-Iran relations added to demand for haven assets.

‘Trade is far and away the more dominant story right now, but sales should not go unnoticed ahead of Consumer Confidence reads later this week,’ said Mike Loewengart, vice president of investment strategy at E*TRADE Financial. ‘Many view retail as a key economic bellwether, and so weakness in the sector could give the bears more to sink their teeth into.’

The unexpectedly weak US economic numbers on the back of data pointing to slowing growth out of China heightened investors concerns Wednesday that the trade war could weigh on a global economy that’s already staggering. Adding to those woes is a growing sense of unease in the Middle East after a spat of attacks on oil assets ratcheted up an already tense relationship between America and Iran.

Elsewhere, oil fell as an industry report signaling a jump in US stockpiles eased concerns over a supply crunch, after a drone attack in Saudi Arabia had highlighted the vulnerability of the country’s energy infrastructure.