US stocks climbed on Monday as easing trade tensions between the United States and China boosted investor sentiment and fueled a broad market rally.
Officials from both nations signaled progress toward a potential trade agreement later this week, setting the stage for a meeting between President Donald Trump and Chinese President Xi Jinping.
The Dow Jones Industrial Average rose 302 points, or 0.6%, while the S&P 500 advanced 0.9% and the Nasdaq 100 gained 1.4%, led by a rebound in semiconductor stocks.
Major indices built on last week’s record highs, when the Dow closed above 47,000 and the S&P 500 surpassed 6,800 for the first time.
Trade deal hopes drive market momentum
Treasury Secretary Scott Bessent said from the ASEAN Summit in Kuala Lumpur that US and Chinese officials had established “a very successful framework” for the leaders to discuss on Thursday.
The proposed deal could include delaying China’s planned restrictions on rare earth exports, halting Trump’s threatened 100% tariffs on Chinese goods scheduled for November 1, and restarting Chinese purchases of US soybeans.
President Trump, speaking aboard Air Force One en route to Japan, expressed confidence that an agreement was near, saying, “I have a lot of respect for President Xi, and we are going to come away with the deal.”
The framework could also resolve the ongoing dispute over TikTok’s US operations.
The easing tensions supported a rally in risk assets, particularly among sectors most exposed to trade uncertainty.
Semiconductor stocks, including Nvidia and Broadcom gained around 2%, while Tesla gained around 1.8% and Apple rose about 1% each.
The optimism was tempered slightly by a diplomatic rift with Canada after Trump imposed an additional 10% tariff on Canadian imports over a dispute involving a TV advertisement referencing former President Ronald Reagan.
Sector highlights: tech leads, miners drop
Chipmakers led early gains as investors anticipated improved trade relations with China, a key market and supply chain hub for the semiconductor industry.
Shares of Nvidia and Broadcom rose nearly 2% each.
In contrast, gold miners fell as prices for the precious metal declined amid signs of a trade truce.
Newmont Corporation fell over 4%, while Coeur Mining and Hecla Mining was down nearly 1% while Barrick Gold fell 1.8%.
Rare earth miners, which had recently benefited from concerns about export restrictions, tumbled after Bessent said China was expected to delay imposing those curbs.
United States Antimony dropped nearly 18%, Critical Metals lost 17%, USA Rare Earth declined 10%, and both MP Materials and Energy Fuels shed around 5% to 6%.
Other gainers and economic outlook
Avidity Biosciences surged nearly 42% after Novartis agreed to acquire the company for about $12 billion in cash.
Janus Henderson gained 17% on reports that Nelson Peltz’s Trian Fund Management and General Catalyst were exploring a buyout.
Lululemon Athletica rose over 2% after announcing a partnership with the NFL and Fanatics on a new apparel line.
On the other hand, Carter’s was almost unchanged, clawing back losses after posting following weak quarterly earnings and plans to cut 15% of its workforce, while Harley-Davidson dropped 2% after a downgrade from Morgan Stanley.
Investors are now turning their attention to a busy week ahead, with the Federal Reserve expected to cut interest rates on Wednesday and major tech firms — including Alphabet, Amazon, Apple, Meta Platforms, and Microsoft — set to release quarterly earnings.
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