NEW YORK (AP) -- A flurry of buyout deals and rising optimism about U.S.-China trade talks sent stocks back to record heights Monday, the latest bit of fuel for a market that's been climbing since early last month.
Technology stocks and smaller companies led the way after China issued new guidelines for the protection of patents and copyrights. Theft of such intellectual property has been a big sticking point in the trade war between the world's largest economies, and markets saw China's move as an encouraging sign for negotiations on the first phase of a deal.
Not only did stocks rise worldwide, the price of gold fell as investors saw less need for safety. A measure of fear in the U.S. stock market called the VIX volatility index also touched its lowest level since July.
The S&P 500 rose 23.35 points, or 0.8%, to 3,133.64. The Dow Jones Industrial Average climbed 190.85, or 0.7%, to 28,066.47, and the Nasdaq composite jumped 112.60, or 1.3%, to 8,632.49. All three indexes set records.
The Russell 2000 index of small-cap stocks rose even more, though it is still below its peak set last year. It surged 32.96, or 2.1%, to 1,621.90.
Stocks have been rallying for weeks as worries about a possible U.S. recession have faded. A resilient job market, which helps households continue to spend, and three interest-rate cuts by the Federal Reserve have bolstered confidence.
Optimism has not been as high for other economies around the world, though, where growth remains slow, said David Kelly, chief global strategist at JPMorgan Asset Management.
"People are still nervous about the rest of the world," he said. "All of this is sort of acting as funnel, directing cash into U.S. equities."
More clues about the resilience of U.S. consumer spending should arrive soon when retailers report on this week's kickoff of the holiday shopping season.
Economists say it needs to remain healthy given pullbacks in spending by businesses amid all the trade uncertainty.
"It's a battle between nervous businesses and confident consumers," Kelly said.
Some companies showed confidence to spend Monday by announcing big buyout deals.
Charles Schwab said it would buy rival TD Ameritrade for about $26 billion, and French luxury group LVMH agreed to pay $16.2 billion for Tiffany.
Tiffany jumped 6.2% for one of the biggest gains in the S&P 500, while Schwab rose 2.3% and TD Ameritrade gained 7.6%.
Technology stocks had the largest gain among the 11 sectors that make up the S&P 500, up 1.4%. Many tech companies have deep ties to China, depending on both suppliers and customers there, and their stocks prices have often swung with sentiment about trade talks. Nvidia jumped 4.9%.
Utilities were the only sector in the S&P 500 to fall. Other stocks known as "defensive" investments, which tend to be in favor when the economy is slowing, also lagged the rest of the market.
The upcoming week will be a short one for investors, with trading closed on Thursday for the Thanksgiving holiday. Otherwise, highlights include reports on consumer confidence, the housing market's strength and consumer spending.
In overseas markets, the Nikkei 225 in Tokyo rose 0.8%, South Korea's Kospi gained 1% and the Hang Seng in Hong Kong jumped 1.5%. London's FTSE 100 climbed 0.9%, France's CAC 40 gained 0.5% and Germany's DAX returned 0.6%.
Benchmark crude oil rose 24 cents to settle at $58.01 a barrel. Brent crude oil, the international standard, rose 26 cents to $63.65 a barrel. Wholesale gasoline was unchanged at $1.67 per gallon. Heating oil climbed 1 cent to $1.94 per gallon. Natural gas fell 14 cents to $2.53 per 1,000 cubic feet.
Gold fell $6.50 to $1,456.60 per ounce, silver fell 12 cents to $16.87 per ounce and copper was unchanged at $2.65 per pound.
The yield on the 10-year Treasury fell to 1.75% from 1.77% late Friday.
The dollar rose to 108.97 Japanese yen from 108.65 yen on Friday. The euro weakened to $1.1009 from $1.1020.