After moving mostly lower early in the session, stocks recovered over the course of the trading day on Monday. The major averages climbed well off their lows of the session and managed to end the day modestly higher.
The major averages crept up to new record closing highs. The Dow edged up 31.33 points or 0.1 percent to 28,036.22, the Nasdaq inched up 9.11 points or 0.1 percent to 8,549.94 and the S&P 500 ticked up 1.57 points or 0.1 percent to 3,122.03.
Stocks initially moved to the downside after a tweet from CNBC's Beijing Bureau Chief Eunice Yoon suggested Chinese officials have grown pessimistic about the chances for a trade deal.
"Mood in Beijing about #trade deal is pessimistic, government source tells me. #China troubled after Trump said no tariff rollback. (China thought both had agreed in principle.)" Yoon tweeted.
She added, "Strategy now to talk but wait due to impeachment, US election. Also prioritize China economic support."
Yoon's tweet offset earlier positive sentiment in reaction to weekend report from Chinese state media indicating the U.S. and China had "constructive discussions" regarding a phase one trade deal in a high-level phone call.
U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin reportedly talked with Chinese Vice Premier Liu He about the core issues for an agreement.
However, traders have recently shown a predilection for taking upbeat reports about the trade talks at face value while shrugging off the negative news.
The prevailing optimism about an eventual trade deal has led to a steady upward trend on Wall Street for the past month and a half.
On the U.S. economic front, the National Association of Home Builders released a report showing homebuilder confidence edged slightly lower in the month of November.
The report said the NAHB/Wells Fargo Housing Market Index slipped to 70 in November after climbing to 71 in October. Economists had expected the index to come in unchanged.
The modest decrease came after the housing market index rose for four straight months to reach its highest level since hitting a matching reading in February of 2018.
Meanwhile, Federal Reserve Chairman Jerome Powell met with President Donald Trump and Treasury Secretary Mnuchin at the White House on Monday.
Powell traveled to the White House at Trump's invitation to discuss the economy, growth, employment and inflation, the Fed said in a statement.
The Fed said Powell's comments were consistent with his remarks at his congressional hearings last week, when he indicated the central bank would leave interest rates on hold for the foreseeable future unless there is a material change in the economic outlook.
Powell did not discuss his expectations for monetary policy, except to stress that the path of policy will depend entirely on incoming information that bears on the outlook for the economy, the Fed said.
The Fed chief also told Trump that the Federal Open Market Committee will make its monetary policy decisions based solely on careful, objective and non-political analysis.
In a subsequent post on Twitter, the president described the sit-down with Powell as a "very good & cordial meeting."
Sector News
Despite the recovery by the broader markets, energy stocks showed a substantial move to the downside, with decreases in associated commodities prices weighing on the sector.
With natural gas for December delivery plummeting $0.122 to $2.566 per million BTUs, the NYSE Arca Natural Gas Index plunged by 3.8 percent, while the Philadelphia Oil Service Index tumbled by 2.3 percent as crude for December delivery slumped $0.67 to %57.05 a barrel.
On the other hand, gold stocks showed a strong move to the upside on the day, driving the NYSE Arca Gold Bugs Index up by 2 percent.
The strength among gold stocks came amid an increase by the price of the precious metal, with gold for December delivery rising $3.40 to $1,471.90 an ounce.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Monday. Japan's Nikkei 225 Index rose by 0.5 percent, while Australia's S&P/ASX 200 Index fell by 0.4 percent.
The major European markets also ended the day mixed. While the U.K.'s FTSE 100 Index inched up by 0.1 percent, the French CAC 40 Index and the German DAX Index dipped by 0.2 percent and 0.3 percent, respectively.
In the bond market, treasuries moved back to the upside following last Friday's pullback. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 2.6 basis points to 1.808 percent.
Looking Ahead
Traders are likely to remain on the lookout for news on the trade front on Tuesday, although the Commerce Department's report on new residential construction may attraction some attention.
On the earnings front, Home Depot (HD), Kohl's (KSS), Medtronic (MDT) and TJX Companies (TJX) are among the companies due to report their quarterly results before the start of trading.
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