U.S. stocks rose Monday after President Donald Trump and China’s President Xi Jinping agreed to another trade truce, but it proved a mixed bag for retail.
The S&P 500 closed up 0.8 percent to a record-high of 2,964.33 on the back of strong gains for chipmakers, while the Dow Jones Industrial Average rose 117 points, or 0.44 percent, to 26,717.43. Also on the rise was the Nasdaq, 1 percent higher to 8,091.16.
It was a mixture of fortunes in the retail world, though. Among the retail stocks ending the day in the black was Tiffany & Co., up 0.7 percent to $94.28; Amazon, 1.5 percent to $1,922; Nike Inc., 1.8 percent to $85.41 and L Brands Inc., 2 percent to $26.61.
Others, however, finished Monday on a negative note. That included Nordstrom, down 1.1 percent to $31.49; Macy’s Inc., 0.3 percent to $21.39; Gap Inc., 0.1 percent to $17.96 and Tapestry Inc., 1.4 percent to $31.30.
Also among the fallers was The RealReal Inc. After a warm welcome on Wall Street Friday, Monday’s reception was notably frostier, with its stock falling 8.1 percent to $26.55 in only its second day of trading as a publicly listed company.
The stock market action followed news over the weekend that the U.S. and China agreed to restart trade negotiations at the G20 Summit in Osaka, Japan, with the former shelving plans to slap 25 percent tariffs on $300 billion worth of Chinese imports, including apparel and footwear.
Trump told reporters that U.S. trade negotiators will now work with their Chinese counterparts to try to make a deal. He did not provide a timing structure, but added that he was not rushed, meaning more uncertainty for fashion companies wanting to make plans for the coming year.
“The positive reaction in most stock markets after the U.S. and China agreed to resume trade talks and each make some minor concessions is not a huge surprise,” said Oliver Jones, an economist at Capital Economics. “Investors did not appear to be expecting much ahead of the summit. And the eventual outcome was probably about the best that could be hoped for given the circumstances.”
He added, though, that he remains pessimistic despite negotiations restarting: “As far as U.S.-China trade is concerned, we have been here before. The truce agreed by the two sides at the previous G20 summit in 2018 lasted only about six months before the U.S. raised tariffs on $200 billion of Chinese imports from 10 percent to 25 percent. While the latest agreement to reopen negotiations is a positive at the margin, there have as yet been no concrete proposals that would address both sides’ fundamental concerns.”