Wall Street rises on U.S.-Mexico trade deal. The S&P 500 and the Nasdaq rallied to record highs on Monday, with the Nasdaq breaking above the 8,000 level for the first time, as investors were encouraged by news that the United States and Mexico reached a trade agreement.
A senior U.S. trade official announced a deal with Mexico to replace the North American Trade Agreement, adding that talks with Canada were expected to begin immediately in hopes of reaching a final agreement by Friday.
The upbeat trade outlook was boosted further as European Union officials said Washington was pressuring the EU to speed up tariff talks.
An official with the American Automotive Policy Council said he was optimistic about the trade deal. Shares of Ford Motor Co (F.N) were up 3.3 percent while General Motors (GM.N) rose 5.0 percent.
Trade-vulnerable industrials such as Boeing Co (BA.N) and Caterpillar Inc (CAT.N) were up 1.2 percent and 2.8 percent, respectively, leading the sector’s advance and pulling the Dow higher.
Mexico-focused iShares MSCI Mexico ETF (EWW.N) was up 2.1 percent.
“The removal of the trade question is helping to lift this market because it removes a major question mark,” said Robert Pavlik, chief investment strategist at SlateStone Wealth LLC in New York.
“The president is probably feeling some pressure from areas of the market that have been impacted,” Pavlik added. “Especially when a lot of these tariffs were hitting (his) voter base.”
The Dow Jones Industrial Average .DJI rose 253.97 points, or 0.98 percent, to 26,044.32, the S&P 500 .SPX gained 20.63 points, or 0.72 percent, to 2,895.32 and the Nasdaq Composite .IXIC added 66.68 points, or 0.84 percent, to 8,012.66.
Of the 11 major sectors of the S&P 500, nine were in positive territory, with the biggest percentage gains in financials .SPNY, materials .SPLRCM and industrials .SPLRCI.
Defensive utilities .SPLRCU and real estate .SPLRCR sectors were the only percentage losers.
Tesla Inc (TSLA.O) stock dipped 1.7 percent on news that Chief Executive Elon Musk was scrapping his scheme to take the electric automaker private.
Chipotle Mexican Grill (CMG.N) was the biggest percentage loser in the S&P 500, down 4.6 percent after Wedbush downgraded the burrito chain’s shares.
Luxury retailer Tiffany & Co was down 2.6 percent ahead of its second-quarter earnings report expected early Tuesday.
Advancing issues outnumbered declining ones on the NYSE by a 1.89-to-1 ratio; on Nasdaq, a 1.74-to-1 ratio favored advancers.
The S&P 500 posted 52 new 52-week highs and no new lows; the Nasdaq Composite recorded 154 new highs and 26 new lows.