(Reuters) – U.S. stocks rose on Tuesday, helped by technology shares, as China stepped in to stabilize the yuan, a day after Wall Street’s main indexes suffered their sharpest one-day percentage declines of the year.
Traders work on the floor at the New York Stock Exchange (NYSE) in New York, U.S., August 6, 2019. REUTERS/Brendan McDermid
The benchmark S&P 500 .SPX and Nasdaq .IXIC lost at least 3% each on Monday, after China let the yuan slide, prompting the U.S. Treasury Department to label Beijing as a currency manipulator.
However, China’s move to fix the yuan at a slightly stronger rate overnight allayed fears of a further escalation in trade war that has been roiling markets since last week when President Donald Trump threatened a new round of tariffs on Chinese imports.
“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.”
Trade tensions ebbed also after White House economic adviser Larry Kudlow said Trump was planning to host a Chinese delegation for further talks in September.
At 11:06 a.m. ET, the Dow Jones Industrial Average .DJI was up 88.54 points, or 0.34%, at 25,806.28, the S&P 500 .SPX was up 13.31 points, or 0.47%, at 2,858.05. The Nasdaq Composite .IXIC was up 54.18 points, or 0.70%, at 7,780.22.
The latest bout of losses has pulled the S&P 500 5.6% away from its all-time high hit last month.
The technology sector .SPLRCT, which includes companies that have a big exposure to China and were at the heart of Monday’s selloff, rose 1.05%, the most among major S&P sectors.
Apple Inc (AAPL.O) gained 1% after three days of heavy losses, while Philadelphia Semiconductor index .SOX climbed 0.91%.
Among other stocks, videogame publisher Take-Two Interactive Software Inc (TTWO.O) jumped 8.5% after raising its full-year revenue forecast.
The materials sector .SPLRCM dropped 0.78%, weighed by a more than 10% drop in scent and flavor maker International Flavors & Fragrances (IFF.N) and fertilizer company Mosaic Co (MOS.N) after the two companies cut full-year earnings forecasts.
Payments processor Mastercard Inc (MA.N) gained 2.1% after it said it would buy a majority of the corporate services businesses of Scandinavian payments group Nets for about $3.19 billion.
Walt Disney Co (DIS.N) was up 0.7% ahead of its results after market close.
Advancing issues outnumbered decliners by a 1.37-to-1 ratio on the NYSE and by a 1.30-to-1 ratio on the Nasdaq.
The S&P index recorded two new 52-week highs and 16 new lows, while the Nasdaq recorded 14 new highs and 106 new lows.
Reporting by Medha Singh and Arjun Panchadar in Bengaluru; Editing by Anil D’Silva and Arun Koyyur