US close: Stocks extend rally as Trump abandons Mexican import tariffs

Wall Street stocks extended their recent rally into a fifth day on Monday amid positive news coming from Washington regarding border control negotiations with Mexican officials.

At the close, the Dow Jones Industrial Average was up 0.30% at 26,062.68, while the S&P 500 closed 0.47% firmer at 2,886.73 and the Nasdaq saw out the session 1.05% stronger at 7,823.17

The Dow closed 78 points higher on Monday, following on from Friday's performance when the index was 263 points higher at the end of trading after a disappointing jobs report raised the prospect of the Federal Reserve easing monetary policy.

Earlier in the week, Federal Reserve chair Jerome Powell had indicated that the central bank would be open to easing monetary policy in order to bolster the economy, boosting investor sentiment.

Also helping to underpin the recent rally was news that Donald Trump had shelved plans to impose tariffs on Mexico after reaching a deal with the country on plans to stem the flow of illegal immigration.

Trump said he had "full confidence" that Mexico would crack down on migration from Central America.

However, on Sunday he also warned America's Southern neighbour that if it failed to cooperate "we can always go back to our previous, very profitable, position of tariffs."

Elsewhere, trade troubles between the US and China were ongoing, as Beijing cautioned global technology companies last week that complying with a ban on telco Huawei Technologies would lead to sector-wide complications.

At the weekend, Treasury Secretary Steven Mnuchin and 19 other finance heads vowed to protect global growth from disruptions, including trade tensions on Sunday.

Speaking at the G-20 meeting of finance ministers and central bankers, in Japan, Mnuchin said he had a "candid" and "constructive" talk with People's Bank of China Governor Yi Gang.

However, in later remarks to CNBC, he said that the President would take a decision regarding further Chinese tariffs after meeting with his counterpart in Beijing, Xi Jinping, later in June.

"If China wants to move forward with the deal, we're prepared to move forward on the terms we’ve done," he said.

"If China doesn’t want to move forward, then President Trump is perfectly happy to move forward with tariffs to re-balance the relationship," added Mnuchin.

Later in the session, Trump said he believes China will make a deal with the US "because they’re going to have to".

"Right now, China is getting absolutely decimated by companies that are leaving China, going to other countries, including our own, because they don’t want to pay the tariffs," Trump said.

Trump and Chinese leader Xi Jinping are set to meet at the G-20 Summit later this month.

Data out earlier showed that China's overall trade surplus hit $41.65bn in May, which was higher than economists had expected.

On the corporate front, United Technologies shares were down 3.13% in early trade after it announced an all-stock merger with defence giant Raytheon. Shares of Raytheon were ahead 0.69%.

Tableau shares soared 33.70% after Salesforce.com agreed to buy the firm at a 42% premium to its closing price on Friday and stock in Tilray shot up 11.19% after the cannabis company announced an agreement that extends the lockup period and provides for the orderly sale of the 75m shares, equivalent to 77% of the outstanding shares, held by its largest shareholder, Privateer Holdings.

News that White House acting budget chief Russell Vought was seeking to delay restrictions on Chinese telco Huawei, which would halt its ability to purchase US-made chips sent shares in chipmakers Nvidia and Advanced Micro Devices 2.8% and 4% higher, respectively.

Ford and General Motors shares drove ahead 1.5% and 0.6% following news of the halt to Mexican tariffs, respectively.

In terms of economic data, April's JOLTS jobs survey revealed that the number of job openings was little changed at 7.4m.

According to the Bureau of Labor Statistics, hires edged up to 5.9m during the month, while separations were little changed at 5.6m. Within separations, the quits rate was unchanged at 2.3% and the layoffs and discharges rate was little changed at 1.2%.