US STOCKS-Wall Street gains on trade optimism, but Beijing tempers hopes

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* Beijing open to partial trade deal - BBG
* China offering extra U.S. agriculture purchases - FT
* Fed minutes support an additional rate cut this year
* Chipmakers see biggest gain in over a month
* Indexes up: Dow 0.7%, S&P 500 0.91%, Nasdaq 1.02%

(Updates to market close)
By Stephen Culp
Oct 9 (Reuters) - Wall Street rose on Wednesday on hopes of
progress in U.S.-China trade talks, though stocks pared gains
late after Chinese officials said Beijing had lowered
expectations for negotiations this week.
All three major U.S. stock averages closed in the black, but
lost ground as the closing bell approached after Chinese
officials said goodwill was damaged by the U.S. Commerce
Department's blacklisting of 28 Chinese companies this week.
Investor sentiment got an early boost following a Bloomberg
report that China remained open to agreeing to a partial trade
deal with the United States. Separately, the Financial Times said Beijing was offering to
increase its annual purchases of U.S. agricultural products.
"A partial deal with China would at least pave the way for a
larger deal down the road," said Tim Ghriskey, chief investment
strategist at Inverness Counsel in New York. "Every day we get a
different tweet and the market takes a different direction.
Today is an up day on a favorable tweet."
Minutes from the U.S. Federal Reserve's September meeting
showed most policymakers supported last month's interest rate
cut, and while all were generally more concerned with risks
associated with the U.S.-China trade war and slowing global
growth among other geopolitical issues, they differed on what
that meant for the U.S. economy. "There was some dissent in the vote, but everyone's together
on the concept of monetary policy setting being data dependent,"
said Joseph Sroka, chief investment officer at NovaPoint in
Atlanta. "And recent data, particularly from the manufacturing
sector, would continue to imply there's a good probability of a
rate reduction at the October meeting."
Trade tensions, signs of slowing economic growth and rising
geopolitical tensions have gripped equity markets so far this
month, with the S&P 500 and Dow Jones indexes off about 2% since
the end of September.
The Dow Jones Industrial Average .DJI rose 182.1 points,
or 0.7%, to 26,346.14, the S&P 500 .SPX gained 26.34 points,
or 0.91%, to 2,919.4 and the Nasdaq Composite .IXIC added
79.96 points, or 1.02%, to 7,903.74.
All 11 major sectors of the S&P 500 closed higher, with
technology .SPLRCT and energy .SPNY enjoying the largest
percentage gains.
Trade-sensitive chipmakers rose, with the Philadelphia SE
Semiconductor index .SOX rising 1.7%.
Microsoft MSFT.O led the Dow's gain, advancing 1.9%, while
Johnson & Johnson JNJ.N was the blue-chip index's sole
decliner.
The drugmaker's shares dropped 2.0% after a jury awarded $8
billion in punitive damages in a case surrounding its
antipsychotic drug Risperdal. With third-quarter earnings season coming into focus,
analysts now expect earnings for S&P 500 companies to drop by
3.1% year-on-year, the first contraction since the earnings
recession that ended in 2016.
Advancing issues outnumbered declining ones on the NYSE by a
1.95-to-1 ratio; on Nasdaq, a 1.60-to-1 ratio favored advancers.
The S&P 500 posted 12 new 52-week highs and 11 new lows; the
Nasdaq Composite recorded 10 new highs and 120 new lows.
Volume on U.S. exchanges was 5.33 billion shares, compared
with the 7.05 billion average over the last 20 trading days.