WASHINGTON (dpa-AFX) - Stocks moved sharply higher in morning trading on Tuesday and remained firmly positive for the remainder of the session. With the jump on the day, the major averages offset the steep losses posted in the previous session.
The major averages pulled back off their best levels of the day but remained firmly positive. The Dow jumped 372.54 points or 1.4 percent to 26,279.91, the Nasdaq soared 152.95 points or 2 percent to 8,016.36 and the S&P 500 surged up 43.23 points or 1.5 percent to 2,926.32.
The rally on Wall Street came after U.S. Trade Representative Robert Lighthizer offered a temporary reprieve from concerns about the U.S.-China trade war by announcing a delay in imposing new tariffs on certain Chinese products.
Lighthizer said the 10 percent tariff set to take effect on September 1st should be delayed until December 15th for certain products.
The products benefiting from the delay include cell phones, laptop computers, video game consoles, certain toys, computer monitors, and certain items of footwear and clothing.
Additionally, the USTR announced certain unidentified products will be removed from the tariff list entirely based on health, safety, national security and other factors.
Lighthizer said the delay is part of the USTR's public comment and hearing process and noted it intends to conduct an exclusion process for products subject to the additional tariffs.
The announcement comes less than two weeks after President Donald Trump announced plans to impose a 10 percent tariff on the remaining $300 billion worth of Chinese imports, sparking a sell-off on Wall Street.
Trump told reporters the delay comes amid concerns the tariffs could impact U.S. customers during the holiday shopping season even though he has repeatedly claimed the trade dispute has not hurt Americans.
In U.S. economic news, the Labor Department released a report showing consumer prices rose in line with economist estimates in the month of July, although the report also showed another bigger than expected increase in core consumer prices.
The Labor Department said its consumer price index climbed by 0.3 percent in July after inching up by 0.1 percent in both May and June. Economists had expected prices to rise by 0.3 percent.
Excluding food and energy prices, core consumer prices also rose by 0.3 percent for the second consecutive month, while economists had expected a 0.2 percent uptick.
Andrew Hunter, Senior U.S. Economist at Capital Economics, said the bigger than expected increase in core prices 'suggests that underlying inflationary pressures may not be as subdued as is widely assumed.'
'Provided that the incoming activity data continue to deteriorate, however, the Fed still looks likely to cut interest rates again next month,' Hunter said.
The report showed the annual rate growth in both consumer prices and core consumer prices accelerated to 1.8 percent and 2.2 percent, respectively.
Sector News
Steel stocks showed a substantial rebound after falling sharply over the two previous sessions, with the NYSE Arca Steel Index spiking by 2.9 percent. The index ended Monday's trading at a nearly three-year closing low.
Considerable strength also emerged among semiconductor stocks, as reflected by the 3 percent jump by the Philadelphia Semiconductor Index.
Computer hardware stocks also turned in a particularly strong performance on the news of the delayed tariffs, driving the NYSE Arca Computer Hardware Index up by 2.2 percent.
Software, retail, and networking stocks also moved notably higher, while gold stocks bucked the uptrend amid a decrease by the price of the precious metal.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Tuesday. Japan's Nikkei 225 Index slid by 1.1 percent, while Hong Kong's Hang Seng Index plummeted by 2.1 percent.
Meanwhile, the major European markets showed a significant rebound after coming under pressure earlier in the day. While the French CAC 40 Index surged up by 1 percent, the German DAX Index climbed by 0.6 percent and the U.K.'s FTSE 100 Index rose by 0.3 percent.
In the bond market, treasuries pulled back after moving sharply higher over the course of the previous session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, climbed 4.1 basis points to 1.680 percent.
Looking Ahead
A report on U.S. import and export prices may attract attention on Wednesday as traders await an avalanche of economic data on Thursday.
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