US Stock Market Overview – Stocks Rally Following US-China Trade Signing

US stocks moved higher on Wednesday following the signing of the US-China trade deal. Sectors were mixed in the S&P 500 index, driven higher by utilities and real estate. Energy shares bucked the trend. Financials as a whole moved lower as trader’s took profits following better than expected earnings results by Bank of America and Goldman Sachs.

US and China Sign Trade Deal

The US and China sign the first phase of a trade deal which includes roughly $200 billion in Chinese purchases of American goods and services over the next two years. Beijing agreed to step up orders of soybeans, pork and other U.S. farm products by $32 billion, of manufactured goods by around $80 billion, of energy products by some $50 billion and of services by about $35 billion. Details on specific product purchases in each of the categories won’t be released, the people said, as both sides feel such disclosure could risk distorting markets.

US Producer Prices Edge Higher

The Labor Department reported on Wednesday that US producer prices edged up in December. The producer price index ticked up 0.1% last month after being unchanged in November. On a year over year basis through December, the PPI increased 1.3% after gaining 1.1% in November.

For all of 2019, the PPI rose 1.3%. That was the smallest gain since 2015 and followed a 2.6% increase in 2018. Expectations had been for a forecast the PPI climbing 0.2% in December and advancing 1.3% on a year-on-year basis. Excluding the volatile food, energy and trade services components, producer prices also nudged up 0.1% in December after being unchanged in November. The so-called core PPI rose 1.5% in the 12 months through December after gaining 1.3% in November. Core PPI increased 1.5% in 2019, also the smallest advance since 2015, after rising 2.8% in 2018.