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Dow rises 161 points as economic-stimulus talks show progress

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  • US stocks moved higher Friday on continued hope that negotiations on fiscal stimulus will lead to a deal before the election.
  • House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin continued negotiations, trying to find middle ground on the size and scope of a new deal.
  • President Donald Trump this week reversed his stance on a stimulus deal and said he now favors a large deal.
  • “Covid Relief Negotiations are moving along,” Trump tweeted on Friday. “Go Big!”
  • Watch major indexes update live here.

US stocks moved higher on Friday as negotiations continued on another round of fiscal stimulus to combat the economic decline caused by the COVID-19 pandemic.

House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin had been trying to make a deal before the November election, but President Donald Trump said earlier this week that negotiations were over.

Fast-forward to Friday, and the talks are back on.

“Covid Relief Negotiations are moving along,” Trump tweeted on Friday. “Go Big!”

Here’s where US indexes stood at the 4 p.m. ET market close on Friday:

  • S&P 500: 3,477.13, up 0.9%
  • Dow Jones industrial average: 28,586.90, up 0.6% (161 points)
  • Nasdaq composite: 11,579.94, up 1.4%

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Senate Majority Leader Mitch McConnell said on Friday morning that a stimulus deal before the election was unlikely. But shortly after McConnell spoke, the White House economic advisor Larry Kudlow said Trump had raised his offer to a $1.8 trillion deal from $1.6 trillion. House Democrats recently passed a $2.2 trillion bill.

“I would like to see a bigger stimulus package, frankly, than either the Democrats or the Republicans are offering,” Trump said in a radio interview with Rush Limbaugh on Friday.

“I’d like to see a bigger package,” he said, adding, “I’d like to see money going to people.”

A deal would likely include another round of stimulus checks for Americans, aid for the airline industry, and an extension of the Paycheck Protection Program, among other things.

JPMorgan said on Friday that a deal appeared to be inching closer to reality after Trump’s reversal from pulling out of negotiations earlier this week.

The takeaway from the stimulus headlines “should be seen mostly incremental progress that keeps a stimulus deal hope alive, but ultimately still pretty unlikely before elections,” JPMorgan said.

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Shares of Xilinx soared as much as 17% on Friday after reports that AMD was in advanced talks to acquire it. Gains in semiconductor stocks broadly helped boost technology names.

The economic recovery in the UK showed signs of slowing: It reported August GDP growth of 2.1%, well below the expectations of 4.6%.

Goldman Sachs upgraded General Electric to “buy” and set a $10 price target, citing the potential for a COVID-19 vaccine to boost its aviation business.

Shaquille O’Neal joined the SPAC craze, announcing that he would join forces with three Disney executives and Martin Luther King III to raise $250 million to help fund a deal targeting the tech and media space.

Gold rose as much as 1.9%, to $1,929.66 per ounce.

Oil traded lower. West Texas Intermediate crude fell as much as 2%, to $40.38 per barrel. Brent crude, oil’s international benchmark, slid 1.7%, to $42.61 per barrel, at intraday lows.

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