Investing.com - The S&P closed just shy of all-time highs Monday, powered by rising energy stocks and easing fears over a full-blown trade war ahead of U.S.-China trade talks later this week.
The Dow Jones Industrial Average rose about 0.35%. The S&P 500 rose 0.23%, while the Nasdaq Composite rose about 0.06%.
Low-level talks between China and U.S. slated for this week have eased investor concerns the current tit-for-tat trade fight could evolve into full-blown trade war, denting both global growth and demand for riskier investments like stocks.
While many are not expecting significant progress to made on the trade war front at this week's talks, it is hoped the dialogue would pave the way for more meaningful talks that could lead to the end of the dispute as early as November, when President Donald Trump and Chinese counterpart Xi Jinping are due to meet.
Signs of optimism on trade helped support shares of Boeing (NYSE:BA) and 3M (NYSE:MMM), which have significant international exposure, making them vulnerable to rising trade tensions.
But gains on a more upbeat outlook for trade were limited by expectations for a further volley of trade tariffs from both the U.S. and China. The U.S. is expected on Thursday to impose 25% tariffs on an additional $16 billion in Chinese imports. And Beijing has threatened to retaliate with 25% tariffs as well.
Energy, meanwhile, rose sharply, pushing the broader market higher, as oil prices made a bullish start to the week on hopes for improved U.S.-China relations and expectations U.S. sanctions against Iran would exacerbate the shortage of global supplies.
On the New York Mercantile Exchange crude futures for October delivery rose 52 cents settle at $66.43 a barrel
Industrials also supported the broader averages as investors piled into battered airline stocks, encouraged by expectations for easing trade tensions and recent forecasts from airline operators for more moderate capacity growth.
American Airlines (NASDAQ:AAL) stock was one of the best performers in the S&P 500, rising 5.8%.
Dealmaking also came to the fore, supporting sentiment for U.S. stocks after PepsiCo (NASDAQ:PEP) said it would buy SodaStream (NASDAQ:SODA) for $3.2 billion. And Tyson Foods (NYSE:TSN) revealed it would buy Keystone Foods for $2.16 billion in cash.
In other corporate news, (NASDAQ:Tesla) managed to finish higher despite doubts over the legitimacy of CEO Elon Musk's claim in a tweet last week that he had secured funding to take the company private.
The Saudi sovereign-wealth fund, which was said to be considering a stake in Tesla to help fund the company's go-private deal, reportedly invested in Lucid Motors, a rival electric automaker in China.
On the political front, Trump over the weekend reportedly said he expected Fed Chairman Jerome Powell to be a cheap-money Fed chief, but two increases in interest rates seen at the Fed so far this year -- with a third pencilled in for as early as September -- have proven otherwise.
Top S&P 500 Gainers and Losers Today:
Macy’s (NYSE:M), American Airlines (NASDAQ:AAL) and Nordstrom (NYSE:JWN) were among the top S&P 500 gainers for the session.
Qorvo (NASDAQ:QRVO), News Corp B (NASDAQ:NWS) and News Corp A (NASDAQ:NWSA) were among the worst S&P 500 performers of the session.