Wall Street opens higher as trade war tensions ease

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Asian markets followed Wall Street's lead and rose sharply on Tuesday, as hopes grew that a trade war between the United States and China could be averted.

At 9.34am local time on Monday, the Dow Jones Industrial Average was up 1.73 per cent at 23,939.32. The S&P 500 .SPX gained 5.02 points, or 0.188825 percent, to 2,663.57. The Nasdaq Composite added 136.21 points, or 1.95 per cent, to 7,128.87.

The Financial Times reported that China is stepping up its efforts to avoid a trade war in part by buying more USA manufactured microchips.

The United States asked China in a letter last week to slash tariffs on US autos, buy more USA -made semiconductors and give US firms greater access to the Chinese financial sector, the Wall Street Journal reported on Monday.

"There are some tentative signs that fears of an escalation of trade tensions are beginning to ease", Craig Erlam, a market analyst at OANDA, wrote in a note to clients, Reuters reported.

"A rebound in global equities overnight is offering the market some optimism of stabilisation after last week's rout".

Technology shares were strong, with Apple advancing 4.8%, Intel 6.3%, Netflix and Adobe Systems both 6.5%. Along with other industrial stocks, they have taken a beating in the wake of Trump's tariffs plans due to their exposure to China.

Stocks recovered after indexes lost more than 6 percent last week - their worst weekly decline in two years - in the wake of tariffs imposed by the US and China against each other.

In 1.30pm trading in NY, the Dow Jones Industrial Average advanced 1.8 percent, while the Nasdaq Composite Index gained 1.7 percent. The Nasdaq Composite held on to a 1.3-per-cent gain. Shares in Dublin were also higher, with the ISEQ up 1%.

"The reality is that there probably isn't a trade war, as evidenced by the fact that there's discussion going on between China and the U.S.to work these things out". But the two sides have reportedly been talking over the weekend.

With nearly all FTSE 100 components higher, the principal drivers of today's outperformance (in terms of points contribution) are RDSB/BP (high oil price, weaker GBP), GSK (M&A), Miners (copper bounce, trade war relief), HSBC (trade war relief), AZN (GSK read-across, weaker GBP) and ULVR/BATS (weaker GBP), all adding at least 4pts a piece. The technology sector weighed with steep losses by Amazon after reports U.S. President Donald Trump wants to go after the company with an antitrust suit.