Wall Street set to rebound after worst day of 2019

Fawad Maqsood August 6, 2019

Wall Street was set to bounce back on Tuesday, as China stepped in to steady the yuan and investors sought beaten-down technology stocks, a day after Wall Street’s main indexes racked up their steepest one-day percentage fall of the year.

The benchmark S&P 500 and Nasdaq lost at least 3pc each on Monday, their sixth straight day of losses, as China let the yuan drop sharply in what was seen as a retaliation to President Donald Trump’s threat to slap a new round of tariffs on Chinese imports last week.

Fears of an escalating trade war were fanned further after US Treasury Department labeled Beijing a currency manipulator late on Monday.

“The fact that China stabilized its currency gives investors some hope that this won’t accelerate into a bigger problem,” said Rick Meckler, partner at Cherry Lane Investments, a family investment office in New Vernon, New Jersey.

“Any positive response by either side that suggests some willingness to negotiate is really going to be taken well by investors.”

At 8:28 a.m. ET, Dow e-minis were up 218 points, or 0.85pc. S&P 500 e-minis were up 24.25 points, or 0.86pc and Nasdaq 100 e-minis were up 75.75 points, or 1.03pc.

Of the 30 Dow Jones Industrial components, 29 were trading higher before the bell.

Shares of technology companies, which have a big exposure to China, were also higher.

Apple Inc rose 1.0pc after three days of heavy losses, while shares of semiconductor companies – Intel Corp , Advanced Micro Devices Inc and Nvidia Corp  – rose between 1.1pc and 2pc.

Industrial bellwethers Boeing Co and Caterpillar Inc  rose about 0.6pc each.

Among other stocks, videogame publisher Take-Two Interactive Software Inc jumped 7.1pc after raising its full-year revenue forecast.

Payments processor Mastercard Inc gained 1.7pc after it said it would buy a majority of the corporate services businesses of European payments company Nets for about $3.19 billion.

Walt Disney Co was up 1.3pc. The company is set to report its third-quarter results after market close.

The latest streak of losses has pulled the S&P 500 about 6pc away from its all-time high hit last month.

Copyright Reuters, 2019

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