The 30-stock Dow rose 86.52 points to 26,743.50 as McDonald's and Boeing outperformed. The S&P 500, meanwhile, closed around the flatline at 2,929.67 after rising as much as 0.4 percent. Both indexes hit fresh all-time highs earlier on the day. For the week, the Dow jumped 2.2 percent while the S&P 500 gained nearly 1 percent.
The the weekly gains pushed the Dow to its first record high since January on Thursday, the same day the S&P 500 posted its first all-time high dating back to late August as investor fears of a full-blown trade war taking place decreased.
"I've been a bit surprised at how robust the rally has been given the chatter on trade," said Michael Geraghty, equity strategist at Cornerstone Capital. He noted, however, equities are also benefiting from strong corporate profits. "The stock market is strong because the economy is strong and the economy is strong because corporate earnings are strong."
The Trump administration announced on Monday it would impose a 10 percent tariff on $200 billion worth of Chinese imports, which would rise to 25 percent by year-end. China retaliated Tuesday by announcing levies targeting over 5,000 American products worth $60 billion and to go into effect next week.
However, these levies were seen as less than feared by analysts and investors, thus helping push stocks back to record highs.
"A full-blown global trade war may yet erupt and derail the global economic expansion, but the odds of such an outcome appear to be diminishing," strategists at MRB Partners wrote in a note, adding this is "spurring a risk-on phase."
"Game theory suggests that even President Trump will want a deal with China, or at least has no incentive to take significant economic risks looking out to 2020," they said. "To this end, Trump has shown that he is willing to do deals, provided he can claim it as a 'win.'"