Stocks Move On Trade Talks As Dow Finds An Unlikely Top Performer In GE

Stocks were higher even as they moved in uncertain fashion as the market showed it’s paying keen attention to trade talks with China.

The Dow Jones industrial average added 1.2%, the S&P 500 0.7% and the Nasdaq composite 0.4%. Volume was lower compared with the same time Friday. Advancers led decliners by 12-to-5 on the NYSE and by a 7-5 ratio on the Nasdaq.

Stocks opened sharply higher after U.S. Treasury Secretary Steven Mnuchin said the U.S. and China “are putting the trade war on hold” as the two sides continue talks. The Nasdaq climbed more than 1% on the news.

But later in the day, stocks surrendered some gains. The drop followed news that top presidential economic advisor Larry Kudlow said the U.S. is not ruling out tariffs on China. The Nasdaq’s gain was whittled down to 0.2% until the composite bounced back.

The S&P 500 and Dow made better bounces, as both traded near session highs. The Nasdaq lagged due to weakness in biotechs, enterprise software and other software stocks.

Boeing (BA) gave the Dow its biggest push, as the aerospace giant added more than 3% and neared a new high. The stock is forming a cup-type base. On a daily chart, a small handle area with a 348.67 entry appeared and has been a successful entry so far, even if it’s an alternative buy point.

General Electric (GE) rarely is one of the best-performing Dow components, but it was the second-best advancer Monday. GE rose 2.5% to touch the highest level since Feb. 5. The company announced it is merging its GE Transportation unit with Wabtec (WAB), the rail equipment maker, in a deal valued at more than $11 billion. Wabtec shares rose 4% in huge volume.

In fact, the transportation sector led the broad market Monday, mainly because of the GE-Wabtec deal and a good showing in trucking, logistics and airlines. Those industry groups were up 2%, 1.6% and 1.4%, respectively. The Dow transportation average rallied 1.4% to its highest since Feb. 2.

Most stocks rising above buy points saw lackluster action, except a few.

Twitter (TWTR) cleared the 33.88 buy point of a cup-with-handle base. Volume was weak and the relative strength line has not made a new high. Those factors hamper the breakout attempt.

Ralph Lauren (RL) broke out of a cup-with-handle base as it topped a 116.79 buy point. Volume was 35% above average.

AstraZeneca (AZN) edged past the 36.85 buy point in major volume. On Friday, the stock was volatile after AstraZeneca reported earnings and a sharp drop in sales of its Crestor cholesterol drug.

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