WASHINGTON, May 13 (dpa-AFX) -- US stocks moved sharply higher during trading on Monday, more than offsetting the modest weakness seen in the previous week, dpa-AFX reported.
The Nasdaq and the S&P 500 reached their best closing levels in over two months.
The Nasdaq soared 779.43 points or 4.4 per cent to 18,708.34, the S&P 500 spiked 184.28 points or 3.3 per cent to 5,844.19 and the Dow surged 1,160.72 points or 2.8 per cent to 42,420.10.
The rally on Wall Street came following news of a US-China trade deal that drastically reduces the massive tariffs on each other's goods for at least 90 days.
"While the trade spat has only been dialled back for 90 days, it's a major breakthrough as far as investors are concerned," said Russ Mould, investment director at AJ Bell.
"Some people thought the best-case outcome from the weekend's discussions would be an agreement to simply keep talks going," he added.
"Therefore, to have reached an initial deal so quickly and one that rolls back tariffs by a large amount is a pleasant surprise."
Semiconductor stocks turned in some of the market's best performances amid a broad-based rally, with the Philadelphia Semiconductor Index soaring by seven per cent to its best closing level in well over two months.
Substantial strength was also visible among transportation stocks, as reflected by the seven per cent spike in the Dow Jones Transportation Average. The average also reached a two-month closing high.
Computer hardware stocks also showed a significant move to the upside, driving the NYSE Arca Computer Hardware Index up by 6.5 per cent.
In the bond market, treasuries moved sharply lower. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, surged 8.2 basis points to a one-month closing high of 4.457 per cent.
Looking ahead, trading on Tuesday may be impacted by reaction to the Labor Department's report on consumer price inflation in April.
-- BERNAMA-dpa/AFX
