Dow Rallies 700 Points From Low After Rough Start Yesterday, Stocks Close Higher
New York (Apr 5) Stocks rose on Wednesday, April 4, after spending most of the day in negative territory after China said it would slap reciprocal 25% tariffs on 106 U.S. products including soybeans, cars, planes, whiskey, and chemicals.
China's move was a response to the Trump administration's proposed tariffs on $50 billion in Chinese goods.
The Dow Jones Industrial Average rose 230 points, or 0.96%, to 24,263; at its session low the Dow fell 510 points. The S&P 500 closed the day up 1.16%. The Nasdaq closed up 1.45%.
The tariffs won't go into immediate effect with U.S. companies given until May 22 to raise objections.
The stocks of companies that could be hit by the tariffs on American goods were mixed Wednesday. Boeing Co. (BA) fell 1%, Caterpillar Inc. (CAT) rose 0.06% and United Technologies Inc. (UTX) rose 0.66%. General Motors Co. (GM) , which traded sharply lower at one point during Wednesday's session, closing up 2.9%.
The industrials sector and energy stocks were the worst performers on Wednesday.
"While corporate fundamentals remain strong, markets are forward-looking and the broadening scope of U.S.-China trade tensions is seen as a growing threat to global growth and corporate earnings, forcing equity valuations lower," said Alec Young, managing director of global markets research at FTSE Russell.
The private sector in the U.S. added 241,000 jobs in March, according to the ADP National Employment Report. Economists surveyed by FactSet had expected an increase of 205,000 jobs.
The ADP jobs report is a precursor to the official U.S. jobs report to be released on Friday, April 6.
Spotify Technology S.A. ( SPOT) fell 2.7% to $144.96 after it closed its first session as a public company on Tuesday at $149.60.
Homebuilder Lennar Corp. (LEN) posted adjusted earnings in its fiscal first quarter of $1.11 a share, topping estimates, while revenue of $3 billion rose 28% from a year earlier. The stock gained 10.2%.
Carmax Inc. (KMX) rose 4.6% even after the seller of used cars missed fourth-quarter sales expectations.
Amazon.com Inc. ( AMZN) may make a rival offer to buy Indian e-commerce company Flipkart, which is in merger talks with Walmart Inc. ( WMT) , Reuters reported, citing local media.
Amazon held early exploratory talks to buy control of Flipkart but a deal with Walmart is more likely, daily newspaper Mint said on Wednesday, citing people with knowledge of the matter.
Amazon shares rose 1.3% on Wednesday. The stock has been under attack this week as Donald Trump has hinted at tighter regulation.
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Viacom Inc. (VIAB) rose 3.9% after a below-market bid for the company by CBS Corp. (CBS) was immediately rejected, sources familiar with the situation told CNBC.
Viacom will now propose a counter offer to CBS, CNBC reported. The owner of Nickelodeon and MTV networks said believes it deserves a market premium and sees cost synergies of at least $1 billion in the combination, sources told CNBC.
WPP PLC ( WPP) on Wednesday said it had begun an independent investigation into CEO Sir Martin Sorrell, after reports of personal misconduct and inappropriate use of company funds.
American depositary receipts of WPP fell 0.43% on Wednesday.
