Stocks get ready to rally on trade hopes

The Dow and the broader US stock market are set to open sharply higher Thursday, buoyed by hopes that trade tensions between the United States and China could ease.

“The catalyst for the optimism was China announcing that it was going to delay retaliation for the latest round of US tariffs,” wrote BMO deputy chief economist Michael Gregory in a note.

China is also willing to resolve the trade dispute “with a calm attitude,” said Gao Feng, spokesperson for China’s ministry of commerce Thursday, according to multiple reports.

Last week, China announced retaliatory tariffs on US imports, which was met with frustration and further threats of tariffs by President Donald Trump.

Dow futures are up nearly 1%, while those for the S&P 500 are 0.9% higher. Nasdaq Composite futures are 1.1% higher.

All in all, markets remain at the mercy of trade headlines.

On the economic data front, the second reading of second-quarter US GDP is due at 8:30 am ET. Following sluggish June construction spending reports and inventories, the number could go lower. Economic growth is expected to be revised down to 2%, from 2.1% at the first reading last month, according to Refinitiv.

Jobless claims and trade data for July are also due at 8:30 am ET.