Stocks Climb After China Slashes Tariffs On US Goods

Stock markets got a boost Thursday from a Chinese move to slash levies on US imports which helped offset concerns about the economic impact of the coronavirus outbreak.

Investors cheered China's announcement that it would halve tariffs on $75 billion worth of US imports after the two sides last month signed their mini trade deal that dialed down a long-running and painful trade war.

This helped equities on both sides of the Atlantic, with Wall Street indices closing at fresh records, building on Wednesday's records following surprisingly good US private-sector hiring data.

CMC Markets analyst David Madden said the move by Beijing on tariffs was "a nice way to take the pressure off the Chinese economy in light of the coronavirus situation."

US Treasury Secretary Steven Mnuchin told Fox Business Network he expects China to fulfill its commitments under the accord to buy $200 billion US farm products and other goods, saying sales would not be derailed by the virus.

China's coronavirus crisis worsened as the death toll soared to 563 as the plight of thousands trapped on quarantined cruise ships deepened global panic over the epidemic.

The rally has come as investors bet that the economic hit from the epidemic will not be lasting even as some analysts warned of potential market volatility due to the outbreak.

"We have been in an environment where people have tended to look through macro risks," said Nate Thooft of Manulife Asset Management, who said markets view the coronavirus as a "temporary" issue that will delay growth "for a quarter or two."

Among individual stocks, Deutsche Bank soared 12.9 percent in Frankfurt after a US fund manager took a large stake in the loss-making German lender, seen as a vote of confidence in its turnaround plans.

Boeing surged 3.6 percent as the head of the Federal Aviation Administration said a certification flight for the 737 MAX could occur within weeks, a positive sign for a jet that has been grounded for almost a year.

Boeing said it still expects the MAX to return to service at mid-year.

Twitter jumped 15.0 percent as it reported lower profits, but topped $1 billion in revenues, adding millions of new users in the fourth quarter.

New York - Dow: UP 0.3 percent at 29,379.77 (close)