US stocks advanced on Wednesday as signs of progress in trade talks between Washington and China lifted sentiment on Wall Street, but stocks ended well below their session highs.
The S&P 500 closed 0.6 per cent higher after rising as much as 1.8 per cent in midday trading. Consumer discretionary shares led the day with a gain of 1.1 per cent. Materials and healthcare were up 1 per cent and 0.9 per cent, respectively. Real estate was by far the main laggard, falling 1.9 per cent.
The Dow Jones Industrial Average advanced 0.6 per cent. The Nasdaq Composite rose 1 per cent on a solid day for the technology sector.
The market was propelled by reports that Beijing is working on a replacement to its Made in China 2025 plan, a move that could provide greater access to foreign companies in a concession to the White House. Meanwhile, China made its first major purchase of US soyabeans since US president Donald Trump and Chinese president Xi Jinping struck a trade truce earlier this month, according to Reuters.
On Tuesday, China moved to cut import tariffs on US-made vehicles, which also raised hopes for a thaw in trade tensions between the world’s two largest economies.
In other geopolitical news, investors kept tabs on developments in the UK, where Prime Minister Theresa May won a no-confidence vote amid uncertainty over the fate of her Brexit deal. The result of the vote by Conservative MPs was released as US markets closed.
The dollar index, which measures the greenback against global currencies, fell 0.4 per cent to 97.02 as the pound strengthened.
The yield on the 10-year Treasury note fell 3 basis points to 2.9114.
Oil prices, which initially climbed after US crude supplies fell by a smaller amount than expected erased their gains. West Texas Intermediate crude was down 1 per cent at $51.15 a barrel. Brent, the international benchmark, lost less than 0.1 per cent at $60.15 a barrel.
Get alerts on US equities when a new story is published