July 31, 2018 / 5:03 PM / 3 months ago

US STOCKS-Industrials, tech lead Wall Street gains on renewed trade hopes

* U.S. and China to restart trade talks - Bloomberg

* Core inflation near Fed target; Central bank meet to start

* Chipotle falls on food poisoning complaints

* Indexes up: Dow 0.70 pct, S&P 0.72 pct, Nasdaq 0.89 pct (Changes comment, updates prices)

By Amy Caren Daniel

July 31 (Reuters) - U.S. stocks rose on Tuesday, led by gains in industrials and a rebound in technology stocks, after a report that the United States and China hoped to resume talks to defuse a trade war between the world’s two largest economies.

Representatives of U.S. Treasury Secretary Steven Mnuchin and Chinese Vice Premier Liu He are having private conversations as they look for ways to reengage in negotiations, Bloomberg reported, citing sources. (bloom.bg/2mZgU3V)

The escalating trade dispute, with the two countries levying tariffs on $34 billion of each other’s goods earlier this month, has weighed heavily on the equity markets. The likelihood of a respite boosted the markets, with nine of the 11 major S&P sectors higher.

“The most important influence on the markets today is some tempering of the trade war escalation,” said Bill Northey, senior vice president at U.S. Bank Wealth Management in Helena, Montana.

“There has been a pretty strong sell-off in technology stocks and we are getting a little bit of a relief rally ahead of some important earnings after markets close.”

After a three-day slide, the technology sector rose 0.81 percent. Apple, due to report after the bell, was up 1.1 percent and was the biggest boost to the S&P 500 and the Dow Jones Industrial Average.

Others in the so-called FAANG group — Facebook, Amazon.com, Netflix and Google parent Alphabet — were up between 0.8 percent and 1.8 percent.

The industrial sector jumped 2.12 percent and was on pace for its best one-day gain in three weeks. Boeing, Caterpillar and 3M jumped between 2 percent and 3.3 percent.

At 12:43 a.m. EDT the Dow Jones Industrial Average was up 177.33 points, or 0.70 percent, at 25,484.16, the S&P 500 was up 20.29 points, or 0.72 percent, at 2,822.89 and the Nasdaq Composite was up 68.11 points, or 0.89 percent, at 7,698.11.

Core personal consumption expenditures (PCE), the Federal Reserve’s preferred measure of inflation, rose 1.9 percent year-over-year in June, the Commerce Department said.

The Fed is expected to leave interest rates unchanged when it wraps up its two-day meeting on Wednesday and has forecast two more rate hikes by December.

The financial sector fell 0.48 percent, with bank stocks the biggest drags on the S&P and the Dow.

Among stocks, Pfizer’s shares rose 2.8 percent, reversing course from premarket losses, after the drugmaker’s quarterly results topped estimates.

Chipotle Mexican Grill sank 5.9 percent after at least 140 people said they had fallen sick after eating at an Ohio restaurant of the burrito chain operator.

Advancing issues outnumbered decliners for a 2.71-to-1 ratio on the NYSE and a 2.34-to-1 ratio on the Nasdaq.

The S&P index recorded 16 new 52-week highs and one new low, while the Nasdaq recorded 24 new highs and 62 new lows. (Reporting by Amy Caren Daniel in Bengaluru; Editing by Shounak Dasgupta)

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