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Indexes up: Dow 0.42%, S&P 500 0.89%, Nasdaq 1.54%

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Rare earth miners fall on signs of U.S.-China trade deal

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U.S.-listed Argentina stocks gain after Milei's election

(Updates with analyst comments, early afternoon prices)

By Pranav Kashyap and Twesha Dikshit

Oct 27 (Reuters) - Wall Street's main indexes notched

record highs on Monday as excitement around a potential

U.S.-China trade deal set the tone for a week packed with Big

Tech earnings and a widely expected interest rate cut.

Earnings from "Magnificent Seven" members Microsoft ( MSFT )

, Apple ( AAPL ), Alphabet, Amazon ( AMZN ),

and Meta later this week will test the endurance of the

AI rally. The five megacaps gained between 1% and 3%.

President Donald Trump and China's Xi Jinping will meet on

Thursday to decide on a framework that could pause tougher U.S.

tariffs and China's rare-earth export curbs, easing market

jitters around a trade war and sending Wall Street's "fear

gauge" VIX down to a one-month low.

U.S.-listed shares of Chinese companies gained on Monday.

Alibaba Group Holding, JD.com and PDD Holdings ( PDD )

rose more than 2% each, while Baidu added 4.8%.

"Markets just want to be positive. Investors want a reason

to buy and they see that reason in whether it's lower rates,

trade deals, decent earnings or the continued dominance of the

AI trade," said Melissa Brown, managing director of investment

decision research at SimCorp.

At 11:21 a.m. ET, the Dow Jones Industrial Average

rose 199.11 points, or 0.42%, to 47,406.23, the S&P 500

gained 60.43 points, or 0.89%, to 6,852.12 and the Nasdaq

Composite gained 353.95 points, or 1.54%, to 23,560.95.

Qualcomm ( QCOM ) surged 15% after unveiling two artificial

intelligence chips for data centers, with commercial

availability from next year. AI chip leader Nvidia ( NVDA ) rose

2.7%.

Tech stocks added 1.4% and the Philadelphia SE

Semiconductor index hit a fresh record high.

"To justify the valuations, we are going to have to see

exceedingly good earnings. There's a lot of expectation that

those earnings are going to be good," Brown said.

FED RATE CUT FULLY PRICED IN

Cooler inflation data last week all but sealed bets for a

25-basis-point rate reduction from the Federal Reserve on

Wednesday, and investors will closely monitor Chair Jerome

Powell's comments for clues on a December cut, as the government

shutdown hinders key data releases.

The rate-sensitive Russell 2000 rose 0.3%, hovering

close to record highs.

Among other stocks, Keurig Dr Pepper ( KDP ) jumped 6.8%

after lifting its annual sales forecast and raising about $7

billion to finance its purchase of Dutch coffee giant JDE

Peet's.

Lululemon shares were up 3.1% after the company

announced a partnership with NFL to launch an apparel

collection.

U.S.-listed shares Of Argentine companies jumped after

President Javier Milei's election victory.

YPF gained 30%, while Grupo Supervielle

surged 50%, and Banco Macro and Grupo Financiero Galicia

advanced 40% each while Banco BBVA Argentina

rose 45%.

Janus Henderson ( JHG ) jumped 13.5% after confirming an

acquisition proposal from Trian and General Catalyst.

Advancing issues outnumbered decliners by a 1.49-to-1 ratio

on the NYSE and by a 1.23-to-1 ratio on the Nasdaq.

The S&P 500 posted 28 new 52-week highs and three new lows

while the Nasdaq Composite recorded 109 new highs and 34 new

lows.

(Reporting by Pranav Kashyap and Twesha Dikshit in Bengaluru;

Editing by Pooja Desai and Devika Syamnath)