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Here Are 3 Hot Things to Know About Stocks Right Now

  • The Dow Jones Industrial Average closed higher Monday after U.S. President Donald Trump said the U.S. and China were "talking" and played down fears of a U.S. recession.
  • Home Depot (HD) - Get Free Report shares were higher as the home-improvement retailer gets set to report second-quarter earnings on Tuesday. Home Depot is Real Money's Stock of the Day.
  • Shares of Estee Lauder (EL) - Get Free Report advanced after the cosmetics company beat Wall Street's fourth-quarter earnings expectations. 

Wall Street Overview

Stocks finished higher Monday after U.S. President Donald Trump said the U.S. and China were "talking," and as Trump and other White House officials played down recession fears.

Another driver of the gains was word from the Commerce Department that Chinese tech giant Huawei would be getting a three-month extension on a key license that allows it to buy parts from U.S. companies.

The PHLX Semiconductor Sector index was up 1.9%, with companies like Advanced Micro Devices (AMD) - Get Free Report and Nvidia (NVDA) - Get Free Report reporting sharp gains.

The Dow Jones Industrial Average rose 249 points, or 0.96%, to 26,135, the S&P 500 advanced 1.2%, and the Nasdaq rose 1.4%. All 11 sectors of the S&P 500 closed higher.

Cisco (CSCO) - Get Free Report ,  Home Depot (HD) - Get Free Report  , and Apple (AAPL) - Get Free Report  led the Dow's advance.

Home Depot (HD) - Get Free Report , which is scheduled to report second-quarter earnings on Tuesday, was climbing 2.1% to $207.95 Home Depot is Real Money's Stock of the Day.

"Tech stocks have been spearheading the charge again, thanks to the Trump administration's second small gesture towards the trade partners of Chinese tech giant Huawei," said Ken Berman, Gorilla Trades strategist. 

Trump took to Twitter over the weekend to say that U.S. was "doing very well with China, and talking!"

"Our economy is the best in the world, by far," Trump later posted. "Lowest unemployment ever within almost all categories. Poised for big growth after trade deals are completed. Import prices down, China eating Tariffs. Helping targeted Farmers from big Tariff money coming in. Great future for USA!"

Trump acknowledged Sunday that Apple CEO Tim Cook had a point about how tariffs in the ongoing U.S.-China trade war could harm the iPhone maker. Since South Korea's Samsung wouldn't see its competing electronics products subjected to tariffs, the import tax could hurt Apple, Cook told Trump, according to Reuters.

"I thought he made a very compelling argument, so I'm thinking about it," Trump told reporters.

Apple shares rose 2% to $210.35.

Commerce Secretary Wilbur Ross said China's Huawei would get a three-month extension on a key license that allows it to buy parts from U.S. companies.

The current agreement was set to end Monday. Ross, speaking on Fox Business Network, said some rural U.S. telecoms are dependent on Huawei, "so we're giving them a little more time to wean themselves off."

Trump also repeated his attacks upon Fed Chairman Jay Powell and the Federal Reserve, assailing their "horrendous lack of vision" and calling for interest rates to be reduced "by at least 100 basis points."

White House chief economic adviser, Larry Kudlow, said talks by phone between representatives of the world's two biggest economies would continue.

Kudlow also rejected fears of a looming recession, saying "there's no recession in sight."

Nevertheless, John Lynch, chief investment strategist at LPL Financial, said the broker-dealer is adjusting its 2019 forecasts.

"We are tweaking our 2019 forecasts to reflect increased risk to economic growth and corporate profits from the ongoing trade conflict between the United States and China," Lynch said. "We are maintaining our year-end fair value target on the S&P 500 of 3,000 as lower interest rates and inflation support higher valuations."

In company news, shares of Estee Lauder (EL) - Get Free Report advanced 12.5% to $201.65 after the cosmetics company beat Wall Street's fourth-quarter earnings expectations amid strong sales of its makeup and other beauty and self-care products, particularly in China and other overseas markets.

Treasury bonds were heavily in the news last week as the market plummeted following the first inverted U.S. yield curve in more than 12 years, a possible sign of a recession. The 10-year Treasury yield was recently up 0.065 to 1.605%.

However, White House trade adviser Peter Navarro said on CNN Sunday "technically, we did not have a yield curve inversion."

On the energy front, the Organization of Petroleum Exporting Countries revised its oil market outlook for 2019, cutting its forecast by 40,000 barrels per day, down to 1.10 million barrels per day.

Brent crude contracts were up $1.17 and selling at $59.81 per barrel, while West Texas Intermediate contracts, which are more tightly linked to U.S. gas prices, were $1.40 higher at $56.21 per barrel.

Shares of Chevron (CVX) - Get Free Report  rose after Barclays initiated coverage of the Houston, Texas-based energy company with an overweight rating and other companies in the energy sector, such as ExxonMobil (XOM) - Get Free Report and Occidental Petroleum (OXY) - Get Free Report also advanced.

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