The stock market today surged ahead in late-afternoon trading, continuing to react to the surprise suspension of tariffs on a wide number of goods. Chinese stocks such as JD.com (JD) and Baozun (BZUN) were big winners, as was U.S.-based Apple (AAPL).
XThe U.S. Trade Representative's office said the U.S. will delay tariffs on a host of back-to-school and holiday goods, including cell phones, laptops, some toys, video game consoles, computer screens, and some shoes and clothing. Some tariffs will still go into effect on Sept. 1, however. Along with the tariff move, U.S. officials spoke with their Chinese counterparts for the first time in weeks and said they would speak again in two weeks.
China said trade talks will soon resume, leading to optimism that a U.S.-China trade deal might still be in the works.
The Nasdaq composite led the charge, jumping 1.9% and rising back above 8000. It's also trying to break through upside resistance at the 50-day moving average. The Dow Jones Industrial Average moved up 1.6% and S&P 500 added 1.7%. The small-cap Russell 2000 Index was the laggard, rising 1.2%.
With the tariff news, volume was heavy. Trade on NYSE was up about 24% from the same time on Monday, while Nasdaq volume grew 27%.
China Stocks Win Big
China stocks were the clear early winners following the tariff news. (For more market coverage throughout the day, visit the Stock Market Today.)
Online and mobile retailer JD.com soared 13.6%. JD.com stock, with a 99 Composite Rating, was buoyed not just by the tariff news, but by its earnings report Tuesday. The retailer crushed earnings estimates of 6 cents a share by posting EPS of 33 cents in its June quarter.
Chinese e-commerce giant Baozun, with a 98 Composite Rating from IBD and a spot on the IBD 50 list of top growth stocks, soared 8%.
Another IBD 50 Chinese name, New Oriental Education & Technology Group (EDU), leapt 3.7%.
New Oriental also holds a spot in IBD Leaderboard.
Stock Market: Tariff Relief Boost U.S. Shares
A number of U.S. companies also got a big boost from the tariff decision.
Apple surged 4.7%, leading among U.S. tech product makers with big investments in China.
The VanEck Vectors Semiconductor ETF (SMH) jumped 3.2%. Among individual chip stocks, Intel (INTC) rose 3.1%, Lattice Semiconductor (LSCC) tacked on 3%, Broadcom (AVGO) pushed ahead 3.1%, Nvidia (NVDA) grew 3.6%, and Xilinx (XLNX) moved up 3%.
Xilinx and many of its chip industry peers are building new bases. A well-formed base, such as the cup with handle and double bottom, provides a proper buy point.
Lattice broke out of a cup with handle on July 9, rushing past a 15.47 entry point in heavy volume. Shares have since rallied as much as 35%.
Consumer Goods, Retail Stocks Advance
Toymaker Hasbro (HAS) jumped 3.4%, while struggling Mattel (MAT) gained 5%.
Meanwhile, shoe and clothing companies such as Nike (NKE) (up 1.9%), Skechers (SKX) (+2.9%), Under Armour (UAA) (up 1.1%), and American Eagle Outfitters (AEO) (+5.8%) posted big gains.
Among retailers, Walmart (WMT) (up 2.3%), Best Buy (BBY) (up 7.1%), Target (TGT) (up 3.1%), Nordstrom (JWN) (up 2.7%) and Kohl's (KSS) (a 3% gain) all notched nice price rises.
Innovator IBD 50 ETF (FFTY) jumped 1.5%, a positive omen for growth stocks.
The U.S. markets have been whipsawed in recent weeks by news both good and bad. While the market is still in correction, the resumption of trade talks between the U.S. and China could provide the underpinning for the market going forward — or at least until Dec. 15, when the tariff delay ends.
Please follow Jones on Twitter at @IBD_TJones for more on growth stocks, financial markets and the economy.
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