The Dow Jones Industrial Average rose by 127 points or 0.46% on Monday morning as hopes for a U.S.-China trade deal and improving domestic economy boosted markets.
The Nasdaq Composite was up 38.52 points or 0.46%, while the S&P 500 was up 13.11 points or 0.43%.
On Friday, Washington and Beijing said they have made progress in suppressing the trade war tensions. U.S. officials indicated that a deal could potentially be signed within the month.
Additionally, Commerce Secretary Wilbur Ross said on Sunday that licenses for U.S. companies to sell components to Chinese technology giant, Huawei, will be coming “very shortly.”
“There is growing enthusiasm over a trade deal, as progress is being made in these talks,” said Peter Cardillo, Chief Market Economist at Spartan Capital Securities in New York.
“Investors are betting that some sort of a deal is on its way, not a whole deal but something that will at least avoid a recession. And markets can live with that,” he added.
The upbeat market negated declines led by McDonald’s (NYSE: MCD) after the Company fired Chief Executive Officer Steve Easterbrook. The stock was trading 2.5% lower during early morning trading hours.
While investors are paying close attention to ongoing trade matters between the U.S. and China, investors are also closely following another week of quarterly financial reports.
So far, Under Armour (NYSE: UAA) and Sprint (NYSE: S) have reported their quarterly results this week. Notably, Under Armour reported disappointing results, which shares plummeting by 16%.
Later on Monday during extended trading hours, Uber Technologies (NYSE: UBER) is set to report. Throughout the week, investors are following companies such as CVS Health (NYSE: CVS), Roku (NASDAQ: ROKU), Square (NYSE: SQ), Teva Pharmaceutical (NYSE: TEVA), and Walt Disney (NYSE: DIS).