LIVE MARKETS-US stock rally extends to second day on trade optimism

• Main US indexes rally, but end off highs
• Tech leads S&P sector gainers; Staples weakest group
• Dollar gains; bitcoin up >2%; crude, gold both slide >2%
• U.S. 10-Year Treasury yield ~flat at ~4.39%

Welcome to the home for real-time coverage of markets brought to you by Reuters reporters. You can share your thoughts with us at markets.research@thomsonreuters.com

U.S. STOCK RALLY EXTENDS TO SECOND DAY ON TRADE OPTIMISM

Stocks staged a strong rally for the second consecutive day on Wednesday as U.S. President Donald Trump’s administration indicated they will de-escalate a trade war with China and after Trump said he doesn’t intend to fire Federal Reserve Chair Jerome Powell.

“Those are clearly both positives that the market was hoping to get, and they got them,” said Russell Price, chief economist at Ameriprise in Troy, Michigan.

U.S. Treasury Secretary Scott Bessent said on Wednesday that high tariffs between the United States and China are not sustainable, as Trump's administration signaled openness to de-escalating a trade war between the world's two largest economies.

Trump, meanwhile, told reporters on Tuesday that he has "no intention” of firing Powell, but "I would like to see him be a little more active in terms of his idea to lower interest rates."

Traders are also focused on earnings season, with 110 of the companies in the S&P 500 already having reported. Of those, 75% have beaten Wall Street estimates, according to LSEG.

Analysts now see aggregate S&P 500 earnings growth of 8.4% for the January to March period, up from 8.0% on April 1.

The Nasdaq Composite .IXIC was the best performing major index, rising by 2.5%, while the S&P 500 .SPX and Dow Jones Industrial Average .DJI gained 1.7% and 1.1%, respectively. Info tech .SPLRCT was up 2.9%, leading S&P 500 index subsector gains, while consumer staples .SPLRCS lagged the most with a 0.4% loss.

Here is Wednesday's closing market snapshot:

(Karen Brettell, Chuck Mikolajczak)

*****

FOR WEDNESDAY'S EARLIER LIVE MARKETS POSTS:

EARNINGS SEASON'S HOT TOPIC: TRUMP'S TRADE WAR - CLICK HERE

FEARS OVER A RECESSION OVERBLOWN, BUT STOCKS DROP WILL DENT CONSUMER SPENDING - CLICK HERE

"LIBERATION DAY" ECONOMICS: FLASH PMI, NEW HOME SALES, MORTGAGES - CLICK HERE

US STOCKS JUMP AS TRUMP/POWELL TENSION CALMS, CHINA TARIFF HOPES CLIMB - CLICK HERE

NASDAQ COMPOSITE BREADTH/MOMENTUM GETS A BOOST - CLICK HERE

THREE WEEKS POST LIBERATION DAY: SCORES ON THE DOORS - CLICK HERE

CARMAGGEDON LEAVES AUTO PARTS SUPPLIERS DOWN BUT NOT OUT - CLICK HERE

WE'RE NOT YET PRICING A RECESSION - CLICK HERE

STOXX AT THREE-WEEK HIGH, VOLATILITY DOWN - CLICK HERE

EUROPE BEFORE THE BELL: ON THE REBOUND - CLICK HERE

MORNING BID: TRUMP'S FED BACKFLIP SETS OFF RELIEF RALLY - CLICK HERE

Monitor