Monday's afternoon trade: Apple and Merck drive Wall Street higher as trade worries abate

US stocks rose on Monday, helped by surges in Apple and Merck & Co as investors set aside worries about the US-China trade war. Shares of Apple rose 2.4% after Chief Executive Officer Tim Cook told a German daily that sales of the company's newest iPhones were off to a strong start, while J.P Morgan raised its forecast for shipment volumes. Apple is struggling to reverse shrinking iPhone sales amid tepid global demand for smartphones.
The S&P 500 technology index and the health care index both added about 1.3%, leading other sectors. Sentiment on Wall Street also got a boost after White House trade adviser Peter Navarro dismissed reports that the Trump administration was considering delisting Chinese companies from US stock exchanges as "fake news."
Concerns related to those reports had sent the S&P 500 and Nasdaq to a more than three-week low on Friday. "This idea of using different types of levers that impact trade negotiations is something that we will get accustomed to," said Phil Blancato, chief executive officer of Ladenburg Thalmann Asset Management in New York.
US-listed shares of Chinese firms Alibaba Group Holding Ltd and Baidu Inc rose over 1%. The next round of high-stakes trade talks between two of the world's largest economies are scheduled for October. Wall Street's main indexes are on course to end September with the weakest quarterly performance so far this year, rattled by a host of factors, including an escalation in U.S-China trade tensions, the inversion of an important part of the US yield curve and political turmoil in Washington.
At 2:36 pm ET, the Dow Jones Industrial Average was up 0.59% at 26,979.04 points, while the S&P 500 gained 0.64% to 2,980.85. The Nasdaq Composite added 0.84% to 8,006.41. Merck & Co gained 2.5% as it presented promising data for its Lynparza cancer drug, which it develops in partnership with Britain's AstraZeneca. Newell Brands jumped 3.3% after SunTrust Robinson Humphrey upgraded the household goods maker to "buy."
Investors this week will focus on economic reports, including a key jobs report and the September ISM purchasing managers index (PMI). August's PMI data showed a contraction in the manufacturing sector. Advancing issues outnumbered declining ones on the NYSE by a 1.63-to-1 ratio; on Nasdaq, a 1.62-to-1 ratio favoured advancers. The S&P 500 posted 17 new 52-week highs and 1 new lows; the Nasdaq Composite recorded 25 new highs and 105 new lows.