US stocks have risen on signs of progress in the ongoing trade talks between the United States and China, but a plunge in shares of Kraft Heinz hit the consumer staples sector.
Top trade negotiators from the two countries haggled over the details of a set of agreements aimed at ending their trade war, just one week before a Washington-imposed deadline for a deal expires and triggers higher US tariffs.
US President Donald Trump and Chinese Vice Premier Liu He are set to meet at the Oval Office later on Friday.
The benchmark S&P 500 index’s recent run of gains was halted on Thursday after a batch of grim economic data, including a surprise fall in new orders for key US-made capital goods.
However, the index is still at more than two-month highs.
Peter Cardillo, chief market economist at Spartan Capital Securities in New York, said the market has shifted from economic worries to the possibility of a breakthrough in the trade talks.
“We’re recovering from yesterday’s sell-off and the main focus is trade,” he said.
Kraft Heinz tumbled 26.9 per cent, weighing the most on the S&P 500 index, along with a 1.9 per cent fall in class B shares of the company’s controlling stakeholder, Berkshire Hathaway.
The packaged food company posted a quarterly loss, disclosed an SEC probe and wrote down the value of its iconic Kraft and Oscar Mayer brands.
The S&P consumer staples sector slipped 0.49 per cent, the most among the 11 major sectors, followed by a 0.29 per cent drop in financials.
Kraft Heinz rivals General Mills, Conagra Brands and Kellogg fell between 3.7 per cent and 4 per cent.
At 10am local time the Dow Jones Industrial Average was up 109.21 points, or 0.42 per cent, at 25,959.84. The S&P 500 was up 10.25 points, or 0.37 per cent, at 2785.13 and the Nasdaq Composite was up 36.32 points, or 0.49 per cent, at 7496.02.
The trade-sensitive industrials sector inched up 0.15 per cent, with bellwether Boeing up 0.8 per cent.
Oil stocks gained 0.55 per cent as crude prices rose to 2019 highs on hopes that Washington and Beijing may soon end their trade dispute.
The Philadelphia Semiconductor Index gained 0.67 per cent, led by Intel’s 2.2 per cent rise after Morgan Stanley lifted its rating to “overweight”.
The technology sector gained 0.97 per cent, lifted by chipmakers and technology heavyweights Apple and Microsoft.
Newmont Mining rose 3.1 per cent after Canada’s Barrick Gold confirmed that it was considering an all-stock bid for the company.
Advancing issues outnumbered decliners by a 3.38-to-1 ratio on the NYSE and by a 1.94-to-1 ratio on the Nasdaq.
The S&P index recorded 42 new 52-week highs and two new lows, while the Nasdaq recorded 64 new highs and 14 new lows.