January 18, 2019 / 10:02 PM / 6 months ago

GLOBAL MARKETS-Stocks rally on trade hopes, dollar has 1st weekly gain of 2019

    * S&P 500 ends up 1.3 pct
    * Dollar higher against basket of currencies
    * Industrials post among biggest sector gains on Wall Street

 (Updates with closing U.S. market levels)
    By Caroline Valetkevitch
    NEW YORK, Jan 18 (Reuters) - World stock indexes jumped on
Friday, with Wall Street posting a fourth straight week of
gains, and the dollar had its first positive week since
mid-December as optimism increased that an end is in sight to
the U.S.-China trade conflict.
    Stocks were boosted by a Bloomberg report that said China
sought to raise its annual goods imports from the United States
by more than $1 trillion in order to reduce its trade surplus to
zero by 2024.             
    That followed a report on Thursday that U.S. Treasury
Secretary Steven Mnuchin was considering lifting some or all
tariffs imposed on Chinese imports. The Treasury denied Mnuchin
had made any such recommendation.             
    While the equity rally lifted all major sectors,
trade-sensitive industrials           posted among the biggest
S&P 500 sector gains, up 1.9 percent on the day. The
Philadelphia SE semiconductor index        rose more than 2
percent and Germany's exporter-heavy DAX          was up 2.6
    "There seems to be some progress going in the trade
negotiations," said Bucky Hellwig, senior vice president at BB&T
Wealth Management in Birmingham, Alabama.
    While that was the biggest influence, "we've still got
momentum since the first of the year," he said. "Some of the
money that came out of the market at year-end, whether it was
high frequency traders or tax-loss selling, is coming back in."
    Adding to strength in equities and supporting U.S. Treasury
yields was data that showed U.S. manufacturing output increased
the most in 10 months in December. 
    Some strategists said relatively light equity trading volume
this week indicated that some investors were still waiting on
the sidelines.             
    The Dow Jones Industrial Average        rose 336.25 points,
or 1.38 percent, to 24,706.35, the S&P 500        gained 34.75
points, or 1.32 percent, to 2,670.71 and the Nasdaq Composite
        added 72.77 points, or 1.03 percent, to 7,157.23.
    The S&P 500 registered its biggest four-week percentage gain
since October 2011. The index is now 8.9 percent below its Sept.
20 record close after dropping 19.8 percent below that level -
near the 20-percent threshold commonly considered to confirm a
bear market - on Christmas Eve.
    The pan-European STOXX 600 index          rose 1.80 percent
and MSCI's gauge of stocks across the globe                
gained 1.23 percent.
    Chinese Vice Premier Liu He will visit the United States on
Jan. 30 and 31 for another round of talks aimed at resolving the
trade dispute between the world's two largest economies.
    Recent indicators show signs that the Chinese economy is
losing momentum.                          
    The trade optimism boosted the dollar against other major
    The dollar index        rose 0.31 percent, with the euro
       down 0.26 percent to $1.1365.
    U.S. Treasury yields rose to three-week highs as investors
piled back into Wall Street.             
    Benchmark 10-year notes             last fell 12/32 in price
to yield 2.7878 percent, compared with 2.747 percent late on
    Oil prices jumped about 3 percent, rising after OPEC
detailed specifics on its production-cut activity to ease global
    Brent crude         gained $1.52 to settle at $62.70 a
barrel, or 2.48 percent higher. U.S. WTI crude futures       
added $1.73 to settle at $53.80 a barrel, or 3.32 percent up.

 (Additional reporting by Ritvik Carvalho in London and April
Joyner in New York; editing by Steve Orlofsky and Sonya
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