Investing.com – The Dow closed higher Thursday but gave up a large portion of its gains after the Trump Administration downplayed a report the U.S. was considering easing tariffs on China to hasten a trade deal.
The Dow Jones Industrial Average closed 0.67% at 24,370.10, below its intraday high of 24,474.46. The S&P 500 gained 0.78% and the Nasdaq Composite climbed 0.71%.
Wall Street pared some gains as investor hopes that a U.S.-China trade deal could be in the offing were dealt a blow by a Treasury spokesman. The spokesman downplayed a report from the Wall Street Journal suggesting that U.S. officials were warming up to the idea of scaling back tariffs on Chinese imports to persuade Beijing to consider deeper concessions on trade.
“Neither Secretary Mnuchin nor Ambassador Lighthizer have made any recommendations to anyone with respect to tariffs or other parts of the negotiation with China,” the Treasury spokesman told CNBC.
The U.S. has slapped tariffs on $250 billion worth of Chinese goods, about half the value of U.S. imports from the country, and many hope a deal can be agreed upon, or at the very least stave off the threat of further escalation.
The 90-day trade-war truce is due to end March 1. Without a deal, President Donald Trump has threatened to impose another round of tariffs and raise duties on imports from China to 25% from 10%.
Caterpillar (NYSE:CAT) and Boeing (NYSE:BA), both barometers of global trade given their large international exposures, closed higher, underpinning industrials and the broader market.
Industrials were also led higher by defense stocks after President Trump outlined a revamped U.S. missile defense strategy. Northrop Grumman (NYSE:NOC) and Lockheed Martin (NYSE:LMT) ended the day higher. Industrial Fastenal (NASDAQ:FAST) also played a role in the broader move higher after it reported earnings and revenue that topped consensus estimates.
Energy names, meanwhile, shrugged off a slip in oil prices on the back off concerns over weak demand and rising U.S. output.