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Chugging Ahead. U.S. stocks finished higher again, hitting fresh closing records. China’s Finance Ministry lowered tariffs on more than 850 types of products, including frozen pork, pharmaceuticals, and semiconductors.
Boeing (ticker: BA) shares rose following the resignation of CEO Dennis Muilenburg. Disney stock (DIS) tumbled as the latest Star Wars movie received lackluster reviews and fell short of expectations for ticket sales in its opening weekend at the box office. In today’s After the Bell, we…
- check out Beijing’s latest tariff reduction ahead of the expected U.S.-China trade deal;
- embrace the shorter-than-usual trading week ahead of the Christmas holiday;
- and learn about Barron’s favorite 10 stocks for 2020.
Less China Tariffs For 2020
All three major indexes finished the day in positive territory and made record highs yet again. The Dow Jones Industrial Average gained 96.44 points, or 0.34%, to 28,551.53, while the S&P 500 added 2.79 points, or 0.09%, to 3224.01 and the Nasdaq Composite is up 20.69 points, or 0.23%, to 8945.65.
Investors were encouraged by China’s latest tariff reductions that could pave the way for Beijing’s commitment in an expected initial trade deal with the U.S. to be signed in January. China’s Finance Ministry said on Monday it will reduce tariffs on more than 850 products imported not just from the U.S., but from all its trading partners, at the beginning of next year.
The tariff cuts—announced not far ahead of January’s Lunar New Year—is meant to “increase imports of products facing a relative domestic shortage, or foreign specialty goods for everyday consumption,” the ministry said in a statement. Products that will benefit include frozen pork, pharmaceuticals, avocados, and semiconductors.
China’s economy is expanding at its weakest rate in nearly three decades, with an expected growth rate of 6% for 2020. Imports have been dropping amid sluggish domestic demand, and Beijing has been cutting levies for a variety of products to encourage domestic consumption—despite the escalating trade tensions with the U.S. and higher tariffs on American goods.
Although the official details of the interim U.S.-China trade deal have not been disclosed, U.S. Trade Rep. Robert Lighthizer has said that Beijing promised to buy $200 billion more of U.S. products over the next two years, including at least $40 billion in farm goods annually. The latest tariff cuts will allow China to import more from the U.S. without incurring anger of other trading partners.
As investors head into the Christmas and New Year holidays, U.S. stocks keep striking a string of records—a contrast to last year’s broad market selloff right around Christmas.
Investors can expect a shorter trading week due to the holidays. Christmas Eve falls on Tuesday, when the New York Stock Exchange and Nasdaq will end trading at 1 p.m. ET, and the bond and commodity markets will close early, too. On Wednesday—Christmas Day—major global markets will be closed.
In between the holiday celebrations and traveling, check out Barron’s top 10 stock picks for 2020, including Google parent Alphabet (GOOGL), U-Haul owner Amerco (UHAL), and United Technologies (UTX). As the market’s relatively cheap names have been staging a comeback since early September, the list for next year also takes a tilt toward value, including Berkshire Hathaway (BRK.A), Comcast (CMCSA), Royal Dutch Shell (RDS.B), Pfizer (PFE), ViacomCBS (VIAC), Anthem (ANTM), and Dell Technologies (DELL).
Write to Evie Liu at evie.liu@barrons.com