Investing.com – Stocks rose on Monday in the wake of a U.S.-China agreement to resume their trade talks and President Donald Trump's brief meeting with North Korean leader Kim Jong-un.
But the gains were smaller than those seen right after the open. The S&P 500 hit a new all-time high, but fell back to a gain of 0.8%. The Dow Jones Industrial Average added 0.4%, but saw its high early in the day cut by about 60%.
The Nasdaq Composite added 1.1%, largely because of a rally in big chip stocks. But it, too, fell back a bit as the day wore on.
The catalyst for the rally was the U.S. agreement to resume trade talks made by Trump with Chinese President Xi Jinping on Saturday in Japan and the U.S. president's Sunday meeting with Kim Jong-un at the Demilitarized Zone in Korea.
Semiconductors had a strong day on the China news, especially the news chip makers can sell products to Huawei, the big Chinese telecommunications company. The Philadelphia Semiconductor index rose 2.4% as the technology sector pushed the overall market higher.
But the cheer created by the announcement faded with reports of manufacturing weakness in the United States and elsewhere.
Boeing (NYSE:BA) was the Dow's big loser, off 2.1% and subtracting 51 points from the index. Apple (NASDAQ:AAPL) was the index's best performer on the day, up 1.8% and adding 25 points to the index.
Boeing continues to face delays in getting its 737 Max airliner back into service. It now appears a fix won't be submitted to the Federal Aviation Administration until September. In addition, news reports suggest investigators are looking into potential manufacturing problems with the 787 Dreamliner.
The IHS Markit U.S. Manufacturing Purchasing Managers’ Index was up in June -- but barely at a reading of 50.6 -- and up from an earlier cut of the data. It was, the Financial Times noted, the second-lowest reading since September 2009.
The market reaction to the China and Korea was similar to what happened on the news of Osama Bin Laden's death. Big open, then a slow decline as the day went along.
Meanwhile, 58 S&P 500 stocks hit new highs on the day. Three Dow stocks hit 52-week highs: American Express (NYSE:AXP), McDonald’s (NYSE:MCD) and Visa I(NYSE:V).
Nine of 103 stocks in the Nasdaq 100 hit new highs, including Marriott International (NASDAQ:MAR) and Cadence Design Systems (NASDAQ:CDNS). Skyworks Solutions (NASDAQ:SWKS) and Wynn Resorts (NASDAQ:WYNN) were the index leaders.
Trading volumes are likely to fall this weekend because of the July 4 holiday when U.S. markets will be closed. Trading is even expected to be light on Friday, despite the Labor Department's release of the June payrolls and unemployment report.
Oil prices moved higher after members of OPEC and the OPEC+ countries agreed to extend output cuts. WTI futures finished up 62 cents to $59.09 a barrel. Brent futures, the global benchmark, added 32 cents to $65.06 a barrel.
Interest rates were higher, with the U.S. 10-Year Treasury yield at 2.034%, up from up 2% on Friday.
Winners and Losers Among S&P 500 Stocks
Skyworks Solutions (NASDAQ:SWKS), Qorvo (NASDAQ:QRVO) and Wynn Resorts (NASDAQ:WYNN) were among the top performing S&P 500 stocks.
Coty (NYSE:COTY), Macerich (NYSE:MAC) and Kimco Realty (NYSE:KIM) were among the worst S&P 500 performers.