U.S. Stocks Reach New Record Highs On Optimism About U.S.-China Trade Deal

(RTTNews) - Stocks have moved mostly higher during trading on Monday, adding to the strong gains posted last week. The major averages have all climbed to new record intraday highs, with the tech-heavy Nasdaq outperforming its counterparts.

Currently, the major averages are off their highs of the session but still firmly positive. The Nasdaq is up 346.83 points or 1.5 percent at 23,551.70, the S&P 500 is up 61.79 points or 0.9 percent at 6,853.48 and the Dow is up 250.38 points or 0.5 percent at 47,457.50.

The continued strength on Wall Street comes amid optimism about a potential U.S.-China trade deal ahead of a highly anticipated meeting between President Donald Trump and his Chinese counterpart Xi Jinping later this week.

Treasury Secretary Scott Bessent met with Chinese officials in Malaysia over the weekend and said he believes the talks have resulted in a "very successful framework" for Trump and Xi to discuss on Thursday.

Bessent also indicated he expects China to resume its purchases of U.S. soybeans and delay the export controls on rare earths that contributed to the recent increase in tensions.

On his way to Japan, Trump also expressed optimism about reaching a trade deal with China after signing separate trade and mineral agreements with his Malaysian and Cambodian counterparts.

Optimism about the outlook for interest rates may also be contributing to the strength on Wall Street ahead of the Federal Reserve's monetary policy announcement this week.

With the Fed widely expected to lower rates by another quarter point when it announces its latest decision on Wednesday, traders are likely to pay close attention to the accompanying for clues about the likelihood of further rate cuts.

CME Group's FedWatch Tool is currently indicating a 96.7 percent chance the Fed will lower rates by a quarter point this week and a 94.1 percent chance of another quarter point rate cut in December.

Sector News

Semiconductor stocks are turning in some of the market's best performances on the day, with the Philadelphia Semiconductor Index surging by 2.4 percent to a new record intraday high.

Qualcomm (QCOM) has helped lead the sector higher, skyrocketing by 19.0 percent after announcing new artificial intelligence accelerator chips to compete with Nvidia (NVDA) and Advanced Micro Devices (AMD).

Significant strength is also visible among software stocks, as reflected by the 1.4 percent gain being posted by the Dow Jones U.S. Software Index.

Brokerage, transportation and oil service stocks are also seeing notable strength, while gold stocks have moved sharply lower along with the price of the precious metal.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved notably higher during trading on Monday. Japan's Nikkei 225 Index surged by 2.5 percent, while China's Shanghai Composite Index jumped by 1.2 percent.

The major European markets have shown more modest moves to the upside on the day. The U.K.'s FTSE 100 Index, the French CAC 40 Index and the German DAX Index are all up by 0.2 percent.

In the bond market, treasuries have moved lower after ending last Friday's trading roughly flat. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 2.1 basis points at 4.018 percent.