* Industrials up as Sino-U.S. trade talks go into Day 3
* Amazon rises again, boosting S&P and Nasdaq
* Boeing jumps on record 2018 deliveries, boosts Dow
* Chip stocks hit by Samsung warning, curb tech gains
* Banks stocks drop as Treasury yield curve flattens
* Indexes up: Dow 0.77 pct, S&P 0.56 pct, Nasdaq 0.70 pct (Updates to early afternoon)
By Sruthi Shankar
Jan 8 (Reuters) - U.S. stocks rose for a third straight day on Tuesday and the S&P 500 touched three-week highs, once again led by Amazon and a rally in industrials on hopes that the United States and China would strike a deal to end a trade war.
The rally, sparked last Friday by a robust U.S. jobs data and dovish comments on interest rates by Federal Reserve chief Jerome Powell, has lifted the S&P by over 9 percent from the 20-month lows hit around Christmas.
The trade talks will continue for an unscheduled third day on Wednesday, when a statement is likely to be issued. So far, officials from both sides have sounded optimistic, with President Donald Trump saying talks were going well.
“You’re seeing some negotiations happen and the market is starting to think that perhaps we’ll start to see a framework evolve,” said Anik Sen, global head of equities at PineBridge Investments.
The trade-sensitive S&P industrials sector rose 1.05 percent. Boeing Co jumped 3.2 percent after reporting it had delivered record 806 aircraft in 2018 and contributed most to the Dow’s rise.
But the biggest support came from the consumer discretionary sector’s 1.05 percent rise.
Amazon.com Inc again led the advance with a 1.7 percent rise that took its market capitalization above $800 billion, cementing its position as the most valuable U.S. company.
At 1:15 p.m. ET, the Dow Jones Industrial Average was up 181.10 points, or 0.77 percent, at 23,712.45. The S&P 500 was up 14.33 points, or 0.56 percent, at 2,564.02 and the Nasdaq Composite was up 47.73 points, or 0.70 percent, at 6,871.20.
Financials was the only S&P sector to log losses, led by bank stocks that fell 0.91 percent as the U.S. Treasury yield curve flattened.
“What’s been notable about the last week is that even as the broader market rallied, the yield curve really hasn’t steepened much,” said Christopher Verrone, partner and head of technical and macro research at Strategas in New York.
“The flattening of the curve again today is likely another macro headwind for financials, and banks in particular.”
Gains in Apple Inc and Microsoft Corp pulled the technology sector up 0.51 percent, but the gains were limited by a drop in chip stocks after Samsung blamed its profit drop on weak chip demand.
The Philadelphia Semiconductor index dropped 1.16 percent. Adding to the woes, Goldman Sachs forecast a tough year for chipmakers, particularly in the first half.
Among stocks, Illumina Inc slid 5.6 percent after the gene test maker gave a weak revenue forecast at the J.P. Morgan healthcare conference.
PG&E Corp shares continued to decline, falling 11.2 percent after S&P Global Ratings stripped the California power utility of its investment-grade credit rating.
Union Pacific Corp rose 8.3 percent after the No.1 U.S. railroad named industry veteran Jim Vena as chief operating officer.
Advancing issues outnumbered decliners by a 2.42-to-1 ratio on the NYSE and a 1.87-to-1 ratio on the Nasdaq.
The S&P index recorded no new 52-week highs and one new low, while the Nasdaq recorded 23 new highs and 13 new lows.
Reporting by Sruthi Shankar and Aparajita Saxena in Bengaluru; Editing by Sriraj Kalluvila