Stocks rose on Tuesday as the latest tariffs on U.S. and Chinese goods are not as bad as previously feared. Strong gains in tech also lifted the broader market.
The Dow Jones Industrial Average surged 188.84 points to 26,246.96 as Nike and Boeing outperformed. The 30-stock Dow also posted its fifth positive day in six.
The S&P 500 gained 0.5 percent to close at 2,904.31, led by consumer discretionary and industrials. The S&P 500 is also less than half a percent removed from its record high. The Nasdaq Composite advanced 0.8 percent to 7,956.11 as Netflix, Amazon, Apple, and Alphabet closed higher.
China announced tariffs targeting more than 5,000 U.S. products will go into effect on Sept. 24. The goods targeted are worth approximately $60 billion. However, China will put a 10 percent tariff on some goods it had previously earmarked for a 20 percent levy. The announcement comes after the Trump administration announced the U.S. will impose 10 percent tariffs on $200 billion worth of Chinese imports, and those duties will rise to 25 percent at the end of the year.
"The market is thinking this wasn't the worst-case scenario," said Daniel Deming, managing director at KKM Financial. "That's why you're seeing this pseudo-rally taking place."
Deming added that strong gains in Asian markets also lifted investor sentiment. "Once we saw the Asian market had the ability to rally, most of the major indexes across the globe got their cue from that," he said. The Shanghai Composite rose nearly 2 percent while the Japanese Nikkei gained 1.4 percent overnight.