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Dow surges 669 points as trade war fears cool

Wall Street got over its trade war fears for a day.The Dow surged 669 points - its third-biggest point gain in...

Posted: Mar 27, 2018 8:35 AM
Updated: Mar 27, 2018 8:35 AM

Wall Street got over its trade war fears for a day.

The Dow surged 669 points - its third-biggest point gain in history - and had its best day in two and a half years. Investors were cheered by signs that the United States and China are talking behind the scenes to avoid a clash between the world's two biggest economies.

It was a sharp reversal after the stock market's worst week in two years. The Nasdaq gained 3.3% and the S&P 500 climbed 2.7%.

The Dow's gain of 2.8% was its biggest since August 2015. The only bigger point gains on record were in October 2008, during the financial crisis.

Related: Wall Street's head-spinning reaction to trade headlines

The Wall Street Journal reported late Sunday that the United States and China started quietly negotiating to expand US companies' access to Chinese markets. The Journal reported that Treasury Secretary Steven Mnuchin was weighing a trip to Beijing to pursue the negotiations.

A Treasury Department spokesperson declined to confirm the report.

"We're not afraid of a trade war, but that's not our objective," Mnuchin said in an interview Sunday on Fox News. "We are going to proceed with our tariffs ... we're also working on investment restrictions," Mnuchin said. "But we are simultaneously having negotiations with the Chinese to see if we can reach an agreement."

Related: The US and China are in talks to try to avoid a trade war

Investors were encouraged by the discussions. Stocks took a beating last week after President Trump announced plans to impose new tariffs on about $50 billion of Chinese goods in retaliation for alleged Chinese intellectual property theft.

The Dow plummeted more than 1,100 points on Thursday and Friday, slipping into a correction - a decline of 10% from the index's all-time high in January. The Dow, S&P 500 and the Nasdaq suffered their biggest weekly losses since January 2016.

China also hit back on Trump's earlier aluminum and steel tariffs by threatening its own tariffs on about $3 billion worth of imports of US goods, including pork, fruit and wine.

Related: China may target American cherries, pistachios and sparkling wine

"The market thinks the tariffs are a trading tactic rather than a hardcore stance," said Sam Stovall, chief investment strategist at CFRA Research.

The "trade tiff" failed to dent the strong global economic outlook, Stovall said. "A sharp V recovery may not be all that surprising."

John Lynch, chief Investment strategist for LPL Financial, believes trade tensions could flare in the coming months, but the longterm risks to the market remain in check.

"When push comes to shove, we expect limited economic impact and manageable disruption to the supply chains of US companies," he said.

Twenty-nine of 30 companies on the Dow gained Monday. Microsoft led the way, gaining more than 7%. A Morgan Stanley analyst report said the company could top $1 trillion in market value within a year, powered by its cloud computing services.

The bond market also rallied from the cool down in US-China tensions.

The 10-year Treasury yield climbed to 2.83%. Last week, the 10-year yield fell sharply to 2.81% last week as investors sought safe haven from volatile stocks. Yields move opposite to prices.

-CNNMoney's Matt Egan and Jethro Mullen contributed to this story.

Mississippi Coronavirus Cases

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Confirmed Cases: 36680

Reported Deaths: 1250
CountyConfirmedDeaths
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DeSoto200920
Madison150839
Jones123149
Harrison118316
Rankin113719
Neshoba104577
Forrest104343
Lauderdale97281
Scott83115
Jackson80419
Washington75313
Copiah67516
Leake63520
Lee63022
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Oktibbeha62328
Warren60021
Holmes59841
Lamar5847
Wayne56819
Yazoo5667
Lowndes54917
Leflore53956
Lincoln53835
Pike51120
Lafayette5094
Sunflower5058
Panola4616
Monroe46036
Simpson4533
Covington4505
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Tate39513
Attala38624
Newton37710
Adams36720
Pontotoc3636
Marion34912
Claiborne31511
Pearl River30832
Chickasaw30219
Winston30211
Marshall2973
Jasper2826
Noxubee2799
Walthall2748
Clay26211
Smith25612
Union25612
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Clarke22825
Lawrence2162
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Carroll18311
Humphreys17410
Calhoun1705
Hancock15213
Itawamba1478
Tippah14711
Jefferson1373
Webster13511
Prentiss1274
Tunica1263
George1253
Jefferson Davis1254
Greene11610
Alcorn1112
Amite1113
Tishomingo1091
Quitman1011
Wilkinson1019
Perry914
Stone772
Choctaw764
Franklin572
Sharkey480
Benton470
Issaquena111
Unassigned00

Alabama Coronavirus Cases

Confirmed Cases: 56441

Reported Deaths: 1136
CountyConfirmedDeaths
Jefferson7012170
Mobile5061140
Montgomery4599112
Tuscaloosa274353
Madison25359
Marshall205012
Shelby176425
Lee164737
Morgan13975
Baldwin134111
Walker111332
Elmore107622
Etowah106914
Dallas10189
DeKalb10017
Franklin95016
Unassigned77728
Autauga71515
Russell7130
Chambers68530
Cullman6686
Limestone6653
Butler65529
Houston6417
Tallapoosa63069
Lauderdale6006
St. Clair5983
Calhoun5545
Colbert5286
Escambia5128
Lowndes49222
Pike4805
Jackson4422
Coffee4364
Covington43512
Talladega4177
Dale4061
Barbour4022
Bullock37810
Hale36323
Marengo36111
Chilton3452
Blount3311
Clarke3236
Wilcox3158
Marion30914
Winston3095
Sumter29713
Pickens2786
Randolph2759
Monroe2683
Perry2552
Conecuh2388
Bibb2271
Macon2229
Choctaw22012
Greene2009
Henry1573
Washington1529
Lawrence1460
Crenshaw1343
Cherokee1317
Geneva1010
Fayette901
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Lamar891
Coosa671
Cleburne481
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