After China declared that it will reduce import tariffs on a wide range of goods, stocks climbed on Monday to new record highs.
Shares of Boeing jumped 2.7% after the company fired CEO Dennis Muilenburg amid the 737 Max crisis. The Dow Jones Industrial Average was trading about 118 points higher, while the S&P 500 and Nasdaq rose 0.2% and 0.3%, respectively.
Investors cheered the news from China overnight as the country announced starting January 1, it will lower import tariffs on over 850 products ranging from frozen pork to some types of semiconductors. China is making efforts to lift imports amid a slowing economy and a trade war with the U.S.
As stocks continued to rally on the back of an easing of geopolitical risks, Wall Street posted fresh record highs on Friday. The S&P 500 was up more than 1.5% last week and posted its fourth consecutive weekly gain. The benchmark is up 28.5% for 2019 through Friday, about 1 percentage point away from 2013′s gain of 29.6%.
Tom Essaye, founder of Sevens Report noted: “Stocks are grinding relentlessly higher into year-end on continued momentum from the positive resolution of four key events: A phase one trade deal, a dovish Fed, economic data that isn’t getting worse and Brexit resolution.”
During the final five trading days of the year and the first two tradings days of the new year, the S&P 500 has posted a 1.3% gain on average since 1950, according to the Stock Trader’s Almanac. This time of year tends to be beneficial for investors as the so-called Santa Claus rally has historically given the stock market a short boost.
On Sunday, a British media reported that Trump has invited U.K. Prime Minister Boris Johnson to visit the White House in the new year, amid hopes of a transatlantic trade deal following Britain’s departure from the European Union on January 31.