S&P Hits Record On Trade, Fed Hopes

The broad-based S&P 500 finished at 3,039, a gain of 0.6 per cent from Friday's close and about 14 points above the previous record set in late July.

The Dow Jones Industrial Average gained 0.5 per cent to finish the day at 27,091, while the tech-rich Nasdaq Composite Index jumped 1 per cent to close at 8,326, also moving within a few points of a record.

Analysts cited upbeat comments from US President Donald Trump on the state of talks with China, as well as hopeful statements over the weekend about the negotiations from the Chinese side.

The upbeat tone on trade came as futures markets overwhelmingly bet the Fed will cut interest rates for the third time in a row.

Some economists and Fed officials argue the central bank should pause to await more details of the trade talks before providing more stimulus.

"The market seems to be saying that between central bank easing and the steps towards enough of a trade agreement to stop tariffs from going up, the world economy is going to stabilize," said LBBW's Karl Haeling.

"This summer there was a great fear of a recession." (AFP)