US equity markets rallied albeit the major indices closed well off their session highs as an early rally for the Energy sector lost some steam - Dow up +95-points or +0.39% after climbing as much as +216-points earlier in the session. The broader S&P500 +0.35%, with Information Technology (up +0.8%) leading seven of the eleven primary sectors higher. Energy settled with a 0.2% after the sector was up as much as +2% at one point. The technology-centric NASDAQ +0.77%. Apple rose +0.7% to a fresh record closing high of US$185.16 per share, extending its winning streak into a sixth consecutive session (which has seen the shares rise +14.1%) after the company's better-than-expected fiscal second quarter result last Wednesday. Apple is currently the most valuable U.S. company with a market capitalization of $910.09B (with the shares needing to rally a further US$18.29 or +9.9% to US$203.45 to achieve a market capitalisation of US$1 trillion). Amazon Inc (up +1.2%) also hit a fresh record high. Citigroup Inc rose +0.82%, with a report in the Wall Street Journal that activist value investor ValueAct Capital Partners LP has built an $1.2B stake in the bank. Berkshire Hathaway Inc class A shares rose +1% after reporting over the weekend that it had posted a rare loss in the first quarter due to lower insurance premiums and an accounting rule change. Investors also digested the latest musings from Berkshire Hathaway Chairman Warren Buffet that included an endorsement of Apple as an investment (noting Berkshire Hathaway currently owns ~5% of the company "but I'd love to own 100% of it"), a view that bonds represented a "terrible investment" near current yields and describing Bitcoin as "probably rat poison squared". Elsewhere, US negotiators weren’t able to secure a trade agreement after two-day talks with counterparts in Beijing. China state media said the talks were positive, and more negotiations would be needed to avoid a trade war, according to the South China Morning Post. For what it's worth, Warren Buffett downplayed the risks of the recent trade tensions between the two countries, observing that he doesn't think the the two dominant global economic players will "do anything that will precipitate a trade war." Also on the trade front, officials from Canada, Mexico and the US met in Washington for another round of discussions regarding the North American Free Trade Agreement (NAFTA). Market participants expect the parties to reach a deal in principle this month.
