By HVY Journalists: The Dow and broader U.S. stock market extended their rally on Monday after the Trump administration strong-armed Mexico into addressing the illegal flow of immigrants across its northern border. U.S. government debt also ticked higher now that a second trade war has been averted.
Dow Extends Rally; S&P 500, Nasdaq Follow
All of Wall Street’s major indexes booked solid gains at the start of the week, extending their rally to at least five days. The Dow Jones Industrial Average climbed 78.74 points, or 0.3%, to 26,062.68. The index was up by as much as 217 points.
The broad S&P 500 Index of large-cap stocks gained 0.5% to 2,886.73, with seven of 11 primary sectors reporting gains. Shares of information technology, financials, and consumer discretionary companies rose at least 0.9%.
The technology-focused Nasdaq Composite Index surged 1.1% to 7,823.17.
The yield on the benchmark 10-year Treasury note, which moves in the opposite direction of bond prices, reached a high of 2.15% on Monday. Last week, yields plunged to 21-month lows on trade-war hostilities and signs of weak economic growth.
Equity markets rallied on Monday after Mexico caved to President Trump‘s demands to stem the flow of illegal migrants into the United States. In a deal that was reached late Friday, Mexico agreed to expand border programs to prevent asylum seekers from entering the United States illegally.
Around a week before the deal was reached, President Trump had threatened to impose a tariff of 5% on all Mexican imports. The tariff was set to increase by five percentage points each month that a new immigration deal wasn’t reached, up to a maximum 25% in October.
On Monday, President Trump tweeted that the United States and Mexico have “fully signed and documented another very important part of the Immigration and Security deal with Mexico,” adding that “it will be revealed in the not too distant future.”
Mexico is one of America’s largest trading partners. In 2018, the value of bilateral trade between the two countries was more than $611 billion, according to the U.S. Census Bureau. Washington had a deficit of $80.6 billion.