Stocks ended higher Monday and gold surged to an all-time high amid a worsening relationship between the U.S. and China and as Wall Street prepared for a week heavy of tech earnings and a Federal Reserve meeting.
The Dow Jones Industrial Average ended up 114 points, or 0.43%, to 26,584, the S&P 500 finished up 0.74% and the Nasdaq gained 1.67%.
Gold jumped to a record $1,944 an ounce intraday as investors sought the safety of the precious metal as tensions rose between Washington and Beijing and as optimism over a recovery from the coronavirus pandemic waned.
Gold settled Monday at a record $1,931 an ounce, up 1.8%.
Stocks in the U.S. declined last week after the Trump administration ordered China to close its consulate in Houston, and Beijing in turn ordered the U.S. to vacate its consulate in the southwestern city of Chengdu.
Doubts about an economic recovery also have been growing as a spike in coronavirus infections again has forced many businesses to close. Meanwhile, a $600 weekly supplement to jobless benefits ends this week and Congress has yet to agree on another coronavirus relief bill. Republicans are expected to release their proposal for the next coronavirus relief bill Monday.
About 190 companies in the S&P 500 will report earnings this week, including Dow components Pfizer (PFE) - Get Pfizer Inc. Report, McDonald's (MCD) - Get McDonald's Corporation (MCD) Report, 3M (MMM) - Get 3M Company Report, Visa (V) - Get Visa Inc. Class A Report, Chevron (CVX) - Get Chevron Corporation Report and Exxon Mobil (XOM) - Get Exxon Mobil Corporation Report.
Tech giants reporting this week include Apple (AAPL) - Get Apple Inc. (AAPL) Report, Amazon.com (AMZN) - Get Amazon.com, Inc. Report, Google parent Alphabet (GOOGL) - Get Alphabet Inc. Class A Report, Advanced Micro Devices (AMD) - Get Advanced Micro Devices, Inc. Report, Facebook (FB) - Get Facebook, Inc. Class A Report and PayPal (PYPL) - Get PayPal Holdings Inc Report.
Earnings so far this season have topped analysts' expectations, with more than 80% of the 128 S&P 500 companies reporting so far beating Wall Street forecasts. Analysts expect the benchmark's collective bottom line will fall some 40.3% from last year once all the numbers are reported.
The Federal Reserve, meanwhile, holds a two-day meeting this week with an announcement on interest rates scheduled for Wednesday afternoon.
“The July FOMC meeting should kick off a period from August into mid-September in which markets should price in an increasingly dovish, forward-looking Fed policy via lower real rates,” strategists at Morgan Stanley wrote in a report. “This should benefit breakeven inflation rates, support risk assets, and weigh on the U.S. dollar.”
The number of confirmed global cases of the coronavirus has risen to nearly 16.3 million.