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US markets end higher after US-China trade deal reached in principle

13 Dec 2019 Evaluate

The US markets closed higher on Thursday, with S&P 500 and Nasdaq Composite indexes ending at record highs, while the Dow Jones Industrial Average saw a new intraday record, after President Donald Trump said that the US and China were nearing a big deal that could avoid fresh tariffs, planned to go in effect December 15, and potentially roll back some existing duties. The latest developments on the trade front come as Trump is meeting with top trade advisers to discuss current plans to raise tariffs on $160 billion worth of Chinese goods on December 15. Besides, a private report said officials circulated talking points ahead of the meeting downplaying the repercussions the new tariffs would have on the US economy.

On the economic data front, first-time claims for US unemployment benefits jumped by much more than expected in the week ended December 7, according to a report released by the Labor Department. The report said initial jobless claims surged up to 252,000, an increase of 49,000 from the previous week's unrevised level of 203,000. Street had expected jobless claims to edge up to 213,000. With the much bigger than expected increase, jobless claims reached their highest level since hitting 257,000 in September of 2017. Meanwhile, with higher prices for goods offsetting lower prices for services, the Labor Department released a report showing US producer prices came in unchanged in the month of November. The Labor Department said its producer price index for final demand was flat in November after climbing by 0.4 percent in October. Street had expected prices to rise by 0.2 percent.

Dow Jones Industrial Average surged 220.75 points or 0.79 percent to 28132.05, Nasdaq gained 63.27 points or 0.73 percent to 8717.32 and S&P 500 was up by 26.94 points or 0.86 percent to 3168.57.

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