Technology companies led stocks to broad gains on Wall Street Monday, driving the S&P 500 and Nasdaq composite indexes to more record highs.
Financial, communications services and industrial stocks also notched solid gains. Health care stocks were the only decliners. Bond prices fell, sending yields higher, and the price of gold fell, signs that investors were favoring higher-risk holdings.
The rally, which added to the market's gains from last week, came as investors looked ahead to the signing of an initial trade deal with China and the potential for future talks.
The world's largest economies are expected to sign the "Phase 1" trade agreement on Wednesday. It is being viewed as an opening to future negotiations that will deal with more complicated trade issues.
Even a partial deal should remove much of the uncertainty that has weighed on companies and investors, at least until after the election, said Scott Ladner, chief investment officer for Horizon Investments in Charlotte.
"We don't think the tariff overhang is going to be very relevant over the next nine months," Ladner said. "Acting tough with China and imposing tariffs two years before an election is a very different story than doing it two months before an election."
The S&P 500 index rose 22.78 points, or 0.7%, to 3,288.13. The Nasdaq composite, which is heavily weighted with technology stocks, climbed 95.07 points, or 1%, to 9,273.93. The S&P and Nasdaq previously set new highs last Thursday.
The Dow Jones Industrial Average gained 83.28 points, or 0.3%, to 28,907.05.
The Russell 2000 index of smaller company stocks picked up 11.96 points, or 0.7%, to 1,669.61.
Across markets, worries about a recession have faded since last year as central banks cut interest rates and pumped stimulus into the global economy. In addition, the promise of a "Phase 1" trade deal between the U.S. and China has helped lift markets in recent weeks, easing investors' concerns of further escalation in the costly conflict.
Full details of the pact are due to be released after the agreement is signed at the White House on Wednesday.
Chipmakers were among the gainers in the technology sector Monday. Nivida climbed 3.1% and Micron Technology rose 1.4%. The sector is particularly sensitive to developments in trade relations because many of the companies rely on China for sales and supply chains. Apple also rose, closing 2.1% higher.
Industrial and communication services companies also made solid gains. General Electric rose 3.9% and Facebook added 1.8%.
Health care stocks slumped, with insurance companies among the sector's biggest decliners. Cigna fell 3.2%, UnitedHealth Group slid 3.1% and Anthem dropped 3.6%.
The yield on the 10-year Treasury rose to 1.85% from 1.82% late Friday. The pickup in yields helped lift financial stocks, as it makes it possible for banks to charge higher interest rates on mortgages and other consumer loans. Goldman Sachs rose 1.3% and Citigroup gained 1.8%.
Electric car maker Tesla jumped 9.8%, closing above $500 for the first time.
Netflix climbed 3% as the streaming video service earned two best picture nominations for the 92nd annual Academy Awards. Both Martin Scorsese's "The Irishman" and Noah Baumbach's "Marriage Story" are contenders.
Traders bid up shares in Hexcel 9.6% after the company said it is being bought by rival Woodward in a deal that will create one of the largest suppliers in the aerospace and defense industry. Woodward rose 4.8% and will own the majority of the combined company when the deal closes.
Wall Street was also gearing up Monday for a busy opening week of corporate earnings being kicked off by major banks. JPMorgan Chase, Wells Fargo and Citigroup will report fourth-quarter earnings on Tuesday and Bank of America will follow on Wednesday.
Analysts predict corporate profits slid by 2% during the fourth quarter, which would mark the first time that earnings for the S&P 500 have fallen four quarters in a row since the period ending in mid-2016, according to FactSet. Companies typically outperform forecasts and temper expectations for sharp declines by the time the bulk of financial reporting is done.
"The management outlooks for this quarter are probably going to be as much, if not more important, than the actual numbers themselves," Ladner said.
Delta Air Lines will be the first major airline to report financial results on Tuesday. The nation's largest health insurer, UnitedHealth Group, will report earnings on Wednesday and railroad operator CSX will report on Thursday.
Wall Street will also have several economic reports to consider this week, including government reports on consumer prices, retails sales and home construction.
Benchmark crude oil fell 96 cents to settle at $58.08 a barrel. Brent crude oil, the international standard, dropped 78 cents to close at $64.20 a barrel. Wholesale gasoline was unchanged at $1.66 per gallon. Heating oil declined 3 cents to $1.90 per gallon. Natural gas fell 2 cents to $2.18 per 1,000 cubic feet.
Gold fell $9.10 to $1,548.40 per ounce, silver fell 10 cents to $17.93 per ounce and copper rose 4 cents to $2.86 per pound.
The dollar rose to 109.93 Japanese yen from 109.54 yen on Friday. The euro strengthened to $1.1138 from $1.1122.
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AP Business Writer Damian J. Troise contributed.