* Mnuchin sees no significant economic impact from CFIUS bill
* Conagra drops after $8.1 bln deal to buy Pinnacle Foods
* Technology, energy stocks lead on S&P
* Indexes up: Dow 0.39 pct, S&P 0.38 pct, Nasdaq 0.40 pct (Updates to open)
By Sruthi Shankar
June 27 (Reuters) - U.S. stocks rose on Wednesday after the Trump administration said it would use a strengthened security review process to deal with threats from Chinese investments in domestic technologies, instead of imposing China-specific restrictions.
The Treasury Department has recommended that Trump use the Committee on Foreign Investment in the United States (CFIUS), whose authority would be enhanced by new legislation in Congress, to control transactions.
U.S. stock futures which were down about 0.5 percent spiked higher to trade flat after the news, which comes two days after reports said the U.S. Treasury was drafting curbs to block firms with at least 25 percent Chinese ownership from buying U.S. companies with “industrially significant technology”.
Treasury Secretary Steve Mnuchin said on CNBC the changes do not target China, and he does not expect any significant economic effect from the enhanced review process.
“Investors are trying to decide what the policy is going to be with respect to trade with China and the rest of the world. It vacillates between their feeling pessimistic about it and some sense of encouragement that it won’t be as severe as feared,” said Rick Meckler, partner, Cherry Lane Investments, a family investment office in New Vernon, New Jersey.
“The big problem is there is no clear message and all we’re doing is bouncing around the recent lows as investors are a little afraid to sell, only to find the administration maybe more accommodative than they thought.”
At 9:48 a.m. EDT the Dow Jones Industrial Average was up 94.21 points, or 0.39 percent, at 24,377.32, the S&P 500 was up 10.33 points, or 0.38 percent, at 2,733.39 and the Nasdaq Composite was up 30.13 points, or 0.40 percent, at 7,591.75.
After the latest news from the Trump administration, U.S.-listed shares of Chinese tech companies, which were in the red earlier, reversed course to trade higher. Alibaba was up 0.3 percent, while JD.com gained 1.4 percent.
Baidu also was up 0.8 percent after announcing a $1 billion share buyback and a team-up with Ford.
Seven of the 11 major S&P indexes were higher, led by a 1.9 percent gain in the energy index, helped by a more than 1 percent jump in oil prices.
Conagra dropped 6.8 percent after the company said it would buy Pinnacle Foods for about $8.1 billion in cash and stock. Pinnacle Foods fell 4 percent after the widely anticipated deal announcement.
Advancing issues outnumbered decliners for a 1.09-to-1 ratio on the NYSE. Declining issues outnumbered advancers for a 1.19-to-1 ratio on the Nasdaq.
The S&P index recorded five new 52-week highs and nine new lows, while the Nasdaq recorded 25 new highs and 23 new lows. (Reporting by Sruthi Shankar in Bengaluru; Editing by Shounak Dasgupta)