Stocks soared to record highs Monday with Nasdaq surging by more than 1 percent and the information technology sector leading advances in the S&P 500.
“Another new Stock Market Record,” President Donald Trump tweeted. “Enjoy!”
The S&P 500 rose 0.8 percent to close at a record 3,133.64. Nasdaq rose 1.3 percent to close at a record 8,632.49.
The Dow Jones Industrial Average also finished at a record high, gaining 190.85 points, or 0.5 percent, to close at 28,066.47.
Nasdaq is up more than 30 percent on the year; S&P is up 25 percent.
U.S. stocks advanced after China released new guidance Sunday increasing penalties on intellectual property rights violations, suggesting it was addressing some of the terms stipulated by the renegotiated trade agreement with the Trump administration.
Unless a trade deal is reached by Dec. 15, another 10 percent tariff will be imposed on technology products manufactured in China.
The General Offices of the Communist Party of China Central Committee and the State Council jointly issued a directive calling for intensified protection of intellectual property rights.
“Strengthening IPR protection is the most important content of improving the IPR protection system and also the biggest incentive to boost China’s economic competitiveness,” the document states.
To reiterate China’s commitment to the trade deal, the state-controlled newspaper, Global Times, reported that “China and the US are very close to the phase one trade deal, and China remains committed to continuing talks for a phase two or even a phase three deal with the US, on equal footing, experts close to the Chinese government told GT.”
Nancy Davis, chief investment officer and founder of advisory firm Quadratic Capital, told MarketWatch Monday that much of the focus has been on the U.S.’s trade confrontation with China but analysts shouldn’t ignore Europe.
“It’s not one on the radar and when people talk trade war all they talk about is China … and the U.S. needs to have good relationships with all of its trade partners,” Davis said.
According to a recent Politico report, the Trump administration is considering “whether to start a new trade investigation against the European Union.” The investigation would be under Section 301 of the Trade Act of 1974.
Section 301 allows the president to impose trade restrictions if an investigation by the administration finds that a country is engaged in a practice that is “unjustifiable and burdens or restricts U.S. commerce.”
“What it would do is it would create a situation that for another year would give the president leverage over the EU,” a former administration official told the news site.
This article was first published by The Center Square.