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US stocks gain as Chinese yuan stabilizes
NEW YORK, Aug 7, 2019 (BSS/AFP) – Wall Street stocks bounced on Tuesday,
ending a multi-session losing streak as China moved to stabilize its currency
amid the escalating US-China trade war.
Analysts pointed to steps taken by the Chinese central bank to boost the
yuan, which slid below a key benchmark on Monday in a move seen as part of
Beijing’s rebuttal to President Donald Trump’s latest tariff announcement.
But the yuan steadied Tuesday while People’s Bank of China Governor Yi
Gang vowed that China would not engage in a competitive devaluation in the
trade war. The move came after the US Treasury Department late Monday
formally designated China a “currency manipulator.”
The Dow Jones Industrial Average rose 1.2 percent to 26,029.52, ending a
five-day slide.
The broad-based S&P 500 gained 1.3 percent to 2,881.77, while the tech-
rich Nasdaq Composite Index climbed 1.4 percent to 7,933.27. Both the S&P 500
and Nasdaq fell the last six days.
The China move “calmed the currency market and we saw the equity market
and the futures market start to turn positive,” said Quincy Krosby, chief
market strategist of Prudential Financial.
But while this boosted sentiment to an extent, “heightened uncertainty
continued to hamper sentiment,” said a stock market note from Charles Schwab.
Analysts say the recent spate of new actions by Beijing and Washington in
the months-long trade war has dimmed hopes for a deal in the near-term, with
some now seeing low odds of an agreement before the 2020 US presidential
election.
Among individual companies, MasterCard rose 3.0 percent after agreeing to
acquire Danish payment service company Nets’ account-to-account payment
business for 2.85 billion euro ($3.19 billion).
BSS/AFP/HR/0938