Wall Street inches higher as trade fears ebb

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(Reuters) – U.S. stocks inched higher on Thursday with investors mulling Washington’s stance on trade as it looked to dial back tariff threats on European cars while moving to impose duties on Chinese goods worth $34 billion.

FILE PHOTO: Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., June 28, 2018. REUTERS/Brendan McDermid

European stocks got a boost after the United States offered to abandon threatened levies on European cars in return for concessions, with German Chancellor Angela Merkel saying she would back lowering European Union tariffs on U.S. car imports.

The rally in Europe spilled over to U.S. stocks, with New York-listed stock of Fiat gaining 5.8 percent. Ford climbed 0.5 percent and General Motors rose 1.2 percent.

The Trump administration’s tariffs on $34 billion worth of Chinese imports are due to go into effect at 0401 GMT on Friday and Beijing said it would instantly respond in equal measure on U.S. goods ranging from cars to soybeans.

Trump has threatened to raise tariffs to as much as $450 billion worth of Chinese goods if China retaliates.

(GRAPHIC: The U.S.-China tariff war and the S&P 500 – reut.rs/2tV7kTm)

“You have mixed messages about tariffs coming out of Washington,” said Michael James, managing director of equity trading at Wedbush Securities in Los Angeles.

“It’s creating a lot of uncertainty about the direction of the true intentions of the White House about tariffs in general.”

Technology stocks led the gains, helped by chipmakers Qualcomm, Intel and Qorvo.

Micron Technologies rose 2 percent after the company said a temporary ban on some sales in China would hurt its quarterly revenue by just 1 percent.

The Philadelphia Semiconductor index rose 1.8 percent.

At 11:31 a.m. EDT the Dow Jones Industrial Average was up 116.47 points, or 0.48 percent, at 24,291.29, the S&P 500 was up 12.27 points, or 0.45 percent, at 2,725.49 and the Nasdaq Composite was up 44.05 points, or 0.59 percent, at 7,546.73.

The U.S. Federal Reserve is set to release minutes from its June 12-13 policy meeting, where it raised interest rates for the second time this year and signaled that more are likely.

The ADP National Employment Report showed private employers added 177,000 jobs in June, below Reuters’ consensus of an increase of 190,000. That comes ahead of the more comprehensive non-farm payroll report on Friday.

Advancing issues outnumbered decliners by a 1.71-to-1 ratio on the NYSE and by a 1.73-to-1 ratio on the Nasdaq.

The S&P index recorded one new 52-week highs and three new lows, while the Nasdaq recorded 53 new highs and 23 new lows.

Reporting by Sruthi Shankar in Bengaluru; editing by Patrick Graham and Arun Koyyur

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