04:53 PM EDT, 10/27/2025 (MT Newswires) -- Equities advanced to new records on Monday amid optimism over a potential US-China trade agreement, while Wall Street awaited the Federal Reserve's monetary policy decision later in the week and a busier earnings calendar.

The technology-heavy Nasdaq Composite jumped 1.9% to 23,637.5. The S&P 500 climbed 1.2% to 6,875.2, while the Dow Jones Industrial Average gained 0.7% to 47,544.6.

All the three main indexes simultaneously notched new record closing highs for a second consecutive session.

Barring consumer staples and materials, all sectors ended higher led by communication services' 2.3% gain, followed by technology's 2% advance.

The US and China are expected to "come away with" a trade deal, US President Donald Trump reportedly said Monday ahead of his meeting with his Chinese counterpart, Xi Jinping, in South Korea on Thursday.

On Sunday, US Treasury Secretary Scott Bessent said the US reached a "substantial framework" with China to possibly delay Beijing's rare earths export restrictions and avoid higher tariffs, NBC News reported.

"We now await more details and news this week from South Korea in a potentially watershed moment for the US/China relationship and trade deals going forward with the tech sector front and center," Wedbush Securities analyst Daniel Ives said in a note.

Not everyone is optimistic about the Trump-Xi historic meeting, though.

"It seems that the US and China have merely come up with a framework that provides a basis for an ongoing dialogue, rather than a deal," Macquarie said in a Monday report. "We remain skeptical (that) a comprehensive agreement would be reached any time soon. We expect the enthusiasm to fade."

US Treasury yields were mixed, with the 10-year rate falling 2.9 basis point to 3.99% and the two-year rate rising 0.9 basis point to 3.51%.

The Fed's monetary policy committee is scheduled to meet Tuesday, with a decision on interest rates due Wednesday. Markets widely expect the central bank to lower its benchmark lending rate by 25 basis points, following a similar move last month, according to the CME FedWatch tool.

Fed Chair Jerome Powell is unlikely to "express any latent fear" over inflation following Friday's soft consumer inflation data, ING said in a Monday report.

The annual headline inflation at 3% is "still enough reason for (Powell) to sound hawkish" after the Federal Open Market Committee delivers a rate cut this week, "and we would not be so assured of another rate cut in December, barring a significant stock-market setback," Macquarie said.

Tech giants Microsoft ( MSFT ) , Alphabet (GOOG, GOOGL) and Meta Platform (META) are scheduled to report their latest quarterly financial results Wednesday, followed by Apple ( AAPL ) and Amazon ( AMZN ) on Thursday.

"This week is not just about whether Big Tech beats forecasts. It is about whether (artificial intelligence) can prove it belongs on the profit line, not just the spending line," Saxo Bank said in a Monday note.

"Investors should focus on tangible signs of payback, such as margins that hold up, users that pay up, and growth that does not depend on another wave of capital expenditure," the firm wrote. "If those numbers appear, the AI trade still has room to run. If they do not, the story shifts."

Some 29% of S&P 500 companies have reported quarterly results in the latest cycle, with earnings up 15.1% from a year earlier on 7.8% revenue growth, Oppenheimer Asset Management said Monday. The brokerage's report released last Monday showed a 16% rise in profits and an 8% increase in sales, based on financials reported by 12% of the index constituents.

Ahead of the reporting season, FactSet's bottom-up estimates put analysts' projected earnings growth at 8%, according to Oppenheimer.

Qualcomm ( QCOM ) shares jumped 11%, the top gainer on the S&P 500, after the company disclosed two new AI chips for data centers and announced an AI infrastructure deal involving those chips with Saudi Arabia's Humain.

West Texas Intermediate crude oil was down 0.1% at $61.46 a barrel in Monday late-afternoon trade.

A US federal government shutdown entered its 27th day Monday. The Senate was scheduled to reconvene Monday, though it's not slated to vote on a House-passed measure to fund the government, CBS News reported.

Gold declined 3.1% at $4,008.70 per troy ounce, while silver lost 3.7% to $46.81 per ounce.