NEW YORK (Reuters) - Wall Street indexes rallied on Wednesday with help from financial stocks as investors eyed strong economic data and trade war fears took a back seat while the Nasdaq registered its third straight record closing high.

White House economic adviser Larry Kudlow said late in the trading day that U.S. President Donald Trump will meet French President Emmanuel Macron and Canadian Prime Minister Justin Trudeau during a G7 summit this week.

While he said Trump is not backing down from the tough line he has taken on trade, the comments appeared to calm investors.

Earlier reports citing sources said U.S. officials were weighing an offer by China to import an extra $70 billion of American goods over a year as Beijing tries to defuse a potential trade war.

“The trade rhetoric has once again dialed back,” said Mona Mahajan, U.S. Investment Strategist, Allianz Global Investors, New York. “It’s the on-again off-again threat of protectionism. It’s off again.”

Trump last week pushed on with imposing tariffs - 25 percent on steel and 10 percent on aluminum - on Canada, the EU and Mexico, with Mexico retaliating by putting tariffs on American products such as steel, pork and bourbon.

The Dow Jones Industrial Average rose 346.41 points, or 1.4 percent, to 25,146.39, the S&P 500 gained 23.55 points, or 0.86 percent, to 2,772.35 and the Nasdaq Composite added 51.38 points, or 0.67 percent, to 7,689.24.

Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., May 29, 2018. REUTERS/Brendan McDermid

The benchmark 10-year U.S. Treasury yield rose to a near two-week high after data showed that the U.S. trade deficit unexpectedly fell to a seven-month low in April, supporting the view of an acceleration of domestic economic growth in the second quarter. [US/]

The S&P financial sector, which rose 1.8 percent, was the S&P’s biggest boost as bank stocks rose along with Treasury yields. Higher interest rates tend to help bank profits. The bank index rose 2.3 percent as the sector was also helped by a rise in mortgage applications for the first time in seven weeks.

Janna Sampson, co-chief investment officer at OakBrook Investments LLC in Lisle, Illinois cited economic data and trade news as reasons for the broader market’s advance.

Nasdaq’s biggest boost was from Comcast Corp, whose shares rose 3.8 percent. Tesla shares jumped 9.7 percent after Chief Executive Officer Elon Musk reassured shareholders that building 5,000 of its mass-market Model 3 cars per week by the end of June was “quite likely”.

While the technology sector reversed earlier losses to end the session with a 0.5 percent gain, it lagged the broader S&P as well as sectors such as financials.

“That to me smacks of a rotation to value from growth,” said Oakbook’s Sampson.

The utilities index was the only one of the S&P’s 11 major sectors in the red, with a 2.1 percent decline.

Facebook was the biggest drag on the tech sector with a 0.8 percent drop after the social networking company confirmed it collaborated with at least four Chinese companies on sharing user data.

Advancing issues outnumbered declining ones on the NYSE by a 1.83-to-1 ratio; on Nasdaq, a 1.54-to-1 ratio favored advancers.

The S&P 500 posted 57 new 52-week highs and 11 new lows; the Nasdaq Composite recorded 278 new highs and 24 new lows.

On U.S. exchanges 6.88 billion shares changed hands, compared to the 6.64 billion average for the last 20 sessions.