US stocks surged to record highs on Monday, buoyed by increasing optimism surrounding a potential US-China trade deal ahead of President Trump’s pivotal meeting with Chinese President Xi Jinping later this week. The Dow Jones Industrial Average climbed approximately 0.7%, translating to over 300 points, while the S&P 500 jumped more than 1.2%, surpassing the significant threshold of 6,800 for the first time. The tech-heavy Nasdaq Composite led the charge, soaring 1.9% to also record a new high.
Wall Street’s positive sentiment comes as it enters a critical week marked by the Federal Reserve’s interest rate decision and a slew of earnings reports from major technology companies, alongside the anticipated Trump-Xi meeting on Thursday. Last week had already concluded on a high note, with all three major indexes hitting all-time highs on Friday. Market dynamics shifted favorably after US and Chinese officials hinted that discussions held over the weekend had set the stage for a breakthrough in trade relations.
Treasury Secretary Scott Bessent expressed confidence in the leaders’ upcoming discussions, stating, “I think we have a very successful framework for the leaders to discuss on Thursday.” In parallel, Beijing signaled a “preliminary consensus” regarding critical issues, offering a respite from trade-war anxieties that had escalated recently. Trump voiced similar sentiments on his journey to Japan, emphasizing his respect for Xi and belief in a forthcoming deal.
In addition, market participants are largely anticipating an interest rate cut by the Federal Reserve, expected to be announced on Wednesday following a two-day meeting. Recent cooler-than-expected inflation data, particularly from the delayed Consumer Price Index report, has strengthened the case for easing.
Key earnings reports from major tech firms, dubbed the “Magnificent Seven,” are poised to be another market catalyst. Companies like Microsoft, Alphabet, and Meta are scheduled to unveil their third-quarter results on Wednesday, while Apple and Amazon will follow a day later.
In a notable corporate development, shares of Qualcomm experienced a dramatic increase of nearly 20% after the company revealed plans to accelerate its data center initiative with new chip technologies, positioning itself in direct competition with Nvidia and AMD.
Whirlpool also reported better-than-expected results, prompting a 3% rise in its stock after hours. The company’s revenue reached $4.03 billion, surpassing Wall Street projections, fueled by new product launches in major appliances and strong sales growth in the KitchenAid line.
In the cryptocurrency realm, Bitcoin surged above $115,000, helping to alleviate concerns surrounding a possible market downturn. This increase coincided with an uptick in equity markets, demonstrating a broader risk-on sentiment among investors.
Other highlights included a bullish report from Robinhood, which saw its stock jump over 5% following a price target increase from an analyst, citing growth in equity transactions and the platform’s prediction markets. Meanwhile, Keurig Dr. Pepper saw its stock rise after it raised its full-year sales outlook based on strong performance in coffee sales and its planned corporate split.
Globally, China reported a 14% year-on-year rise in non-ferrous mining and refining activity, including rare earths, further underscoring the nation’s investment in this critical resource sector as trade discussions loom.
With macroeconomic indicators and corporate earnings adding layers of complexity, investors appear set for a dynamic week ahead as they monitor developments from both the Fed and the potential trade deal with China.
