Wall Street rallies higher on trade deal hopes
- Financial shares post strong gains on the back of rising Treasury bond yields.
- Defensive sectors struggle to gain traction in early trade.
- CBOE Volatility Index falls nearly 5% on Friday.
Wall Street's main indexes started the last day of the week sharply higher boosted by hopes of the United States (US) and China reaching a trade deal at the end of today's high-level talks in Washington. As of writing, the Dow Jones Industrial Average was up 1.2% on the day while the S&P 500 and the Nasdaq Composite were adding 1.1% and 1.5%, respectively.
The upbeat market mood, as reflected by a 5% fall in the CBOE Volatility Index, is also providing a boost to the US Treasury bond yields. Among the 11 major S&P 500 sectors, the rate-sensitive Financials Index is leading the rally by adding more than 1.6% in the early trade alongside the trade-related Industrials Index, which is up nearly 1.5%.
On the other hand, the so-called defensive sectors, Utilities, Consumer Staples, and Real Estates, are staying in the negative territory to confirm the positive sentiment.