For the second consecutive session, the three major indices closed at record highs: the Dow Jones Industrial Average rose 0.71% to 47,544.59 points, the Nasdaq gained 1.86% to 23,637.46 points, and the S&P 500 increased by 1.23% to 6,875.17 points.
“There is a lot of excitement about the idea that Donald Trump is considering a trade deal with China,” summarized Peter Cardillo of Spartan Capital Securities.
Finance Secretary Scott Bessent announced on Sunday that Beijing admitted it might delay the start of restrictions on rare earth exports and resume soybean purchases from the U.S.
In exchange, the Americans have agreed to forego imposing additional tariffs of 100 percentage points on imports from China.
However, Patrick O’Hare from Briefing.com noted, “Nothing is decided yet.” Trump and Chinese President Xi Jinping are expected to meet on Thursday and then make an official announcement, he added.
Another factor contributing to the stock market gains was the anticipation around the outcome of the Fed’s two-day monetary policy meeting starting on Tuesday, with analysts expecting a quarter-point cut in the benchmark interest rate.
“The question is whether Jerome Powell (the Fed Chair) will be more accommodative than expected,” Cardillo emphasized.
Moreover, Wall Street is in the midst of a highly followed earnings season, with results from major tech conglomerates such as Microsoft, Alphabet (Google), Meta (Facebook, Instagram), Apple, and Amazon being released.
If any of these companies report numbers below expectations, it could “cool the mood” and “raise questions,” Cardillo predicted.
