Stocks Jump on Trade Progress Hopes…..

U.S. equities finished solidly in the green, as early gains amid increased hopes of a more dovish Fed at the conclusion of its two-day meeting were further fueled from a tweet from President Trump that he will meet with Chinese President Xi at next week’s G-20 summit. Global policy stimulus also got a shot in the arm after European Central Bank (ECB) President Mario Draghi surprised the markets by hinting that further rate reductions may be necessary if the outlook for economic growth didn’t materialize, and as policy decisions from the Bank of England and the Bank of Japan are to come on Thursday. Treasury yields were mixed and the U.S. dollar ticked higher, while crude oil prices recovered from a recent tumble, and gold added to a current rally.

The Dow Jones Industrial Average (DJIA) jumped 353 points (1.4%) to 26,466, the S&P 500 Index gained 28 points (1.0%) to 2,918, and the Nasdaq Composite advanced 109 points (1.4%) to 7,954. In moderate volume, 772 million shares were traded on the NYSE and 2.2 billion shares changed hands on the Nasdaq. WTI crude oil rose $1.97 to $53.90 per barrel and wholesale gasoline was up $0.03 at $1.72 per gallon. Elsewhere, the Bloomberg gold spot price added $6.76 to $1,346.42 per ounce, and the Dollar Index— a comparison of the U.S. dollar to six major world currencies—was 0.1% higher at 97.63.

Housing starts for May declined 0.9% month-over-month (m/m) to an annual pace of 1,269,000 units, above the Bloomberg forecast of 1,239,000 units. April starts were revised higher to an annual pace of 1,281,000. Construction on single-unit structures were down m/m and y/y, but activity on multi-unit buildings were up solidly m/m and versus last year. Building permits, one of the leading indicators tracked by the Conference Board as it is a gauge of future construction, rose 0.3% m/m to an annual rate of 1,294,000, versus expectations of a 1,292,000 pace, and compared to April’s downwardly-revised 1,290,000 rate. Single unit authorizations were up m/m but down y/y, while permits for multi-unit structures fell m/m and were up compared to last year.

Treasuries were mixed, as the yield on the 2-year note rose 2 basis points (bps) to 1.87%, while the yields on the 10-year note and 30-year bond fell 2 basis points to 2.06% and 2.55%, respectively.

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