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Nasdaq, S&P 500 Climb To New Record Closing Highs

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Stocks moved mostly higher over the course of the trading day on Monday, rebounding following the pullback seen in the previous session. With the upward move on the day, the Nasdaq and the S&P 500 ended the session at new record closing highs.

The Nasdaq and the S&P 500 saw further upside going into the close, while the narrower Dow posted a more modest gain. While the Dow rose 83.28 points or 0.3 percent to 28,907.05, the Nasdaq jumped 95.07 points or 1 percent to 9,273.93 and the S&P 500 advanced 22.78 points or 0.7 percent to 3,288.13.

The strength on Wall Street came amid continued optimism about impact of the phase one U.S.-China trade deal due to be signed later this week.

Chinese Vice Premier Liu He is scheduled to visit Washington to sign the deal, which is said to include reduced tariffs on Chinese goods in exchange for increased Chinese purchases of U.S. agricultural products.

In an interview with Fox News on Sunday, Treasury Secretary Steven Mnuchin said the agreement calls for China to purchase $40 to $50 billion worth of U.S. agricultural products annually.

Mnuchin described the agreement as "very, very extensive," although the deal will not completely resolve the trade dispute between the U.S. and China.

Stocks saw further upside after various media reports said the Treasury Department plans to drop its designation of China as a "currency manipulator" ahead of the signing of the deal.

A report from the Wall Street Journal said the trade agreement will include a section on Chinese currency practices that addresses many of the concerns raised when the U.S. applied the manipulator designation last August.

The news drew criticism from Senate Minority Leader Chuck Schumer, D-N.Y., who accused President Donald Trump of caving to Chinese President Xi Jinping.

"When it comes to the president's stance on China, Americans are getting a lot of show and very little results," Schumer said in a statement.

Sector News

Steel stocks turned in some of the market's best performances amid optimism about the impact of the U.S.-China trade deal, with the NYSE Arca Steel Index jumping by 1.8 percent.

Considerable strength also emerged among networking stocks, as reflected by the 1.6 percent gain posted by the NYSE Arca Networking Index.

Chemical, semiconductor and software stocks also saw significant strength on the day, moving higher along with most of the other major sectors.

Meanwhile, gold stocks bucked the uptrend, dragging the NYSE Arca Gold Bugs Index down by 2.6 percent amid a notable decrease by the price of the precious metal.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Monday, with the Japanese markets closed for a holiday. China's Shanghai Composite Index climbed by 0.8 percent, while South Korea's Kospi jumped by 1 percent.

Meanwhile, the major European markets turned in a mixed performance on the day. While the U.K.'s FTSE 100 Index rose by 0.4 percent, the French CAC 40 Index closed just below the unchanged line and the German DAX Index dipped by 0.2 percent.

In the bond market, treasuries gave back ground after moving higher over the two previous sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price rose by 2.3 basis points to 1.848 percent.

Looking Ahead

Trading on Tuesday may be impacted by reaction to earnings news from companies Citigroup (C), JPMorgan Chase (JPM), and Wells Fargo (WFC), which are due to report their results before the start of trading.

The Labor Department's report on consumer price inflation may also attract some attention, with consumer prices expected to rise by 0.3 percent in the month of December.

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