The Dow Jones Industrial Average rose slightly to a fresh record on Tuesday, lifted by strong economic data and new developments between the U.S. and China on trade.
The 30-stock gauge gained about 30.52 points, or 0.1%, to a new record closing high of 27,492.63 in its third straight positive day. The Nasdaq Composite was little changed at 8,434.68, weighed down by a 1.6% loss in Netflix shares. The S&P 500 fell 0.1% to 3,074.67 however, as underperformance in real estate and utilities sectors capped gains in the broad market.
Dow-component Boeing gained 2% after the company said the CEO would forgo bonuses this year amid the 737 Max crisis.
Strong earnings, more promising economic data and trade progress drove the Dow to an all-time high on Monday, following the S&P 500 and Nasdaq's new records reached last week.
"You always get a little vertigo at all-time highs and you're getting a little bit of that today," said Art Hogan, chief market strategist at National Securities.
China is pushing President Donald Trump to remove more tariffs on about $125 billion worth of Chinese goods imposed in September as part of the "phase one" trade deal, reports said. "Firmer commitments on lifting tariffs" are needed for China to pay a visit to the U.S., according to the South China Morning Post.
"It's encouraging but we are eyeing it skeptically," said Mike Loewengart, vice president of investment strategy at ETrade Financial. "We would caution investors to not pin all their hopes for a phase one deal coming into fruition in the weeks ahead."
The two sides are in the process of picking a new location for the deal signing after the original meeting in mid-November was canceled due to unrelated reasons. China said Friday that it has reached a consensus with the U.S. in principle after talks last week.
Better-than-expected economic data helped lift the Dow. A gauge for U.S. services activities topped expectations for October. The ISM non-manufacturing index came in at 54.7, as compared with a 53.5 estimate as forecast by economists polled by Dow Jones.
The financial sector was the best-performing group among 11 S&P 500 sectors as yields continued to rise on trade-deal hopes. Bank of America was up 1.3%, while J.P. Morgan rose 0.2%.
The Dow's year-to-date gain now stands at nearly 18% after rallying 3.4% in the past month. The S&P 500 is up more than 22% this year after surging 4.1% in the past month.
The corporate earnings season has largely been better than expected as 75% of the S&P 500 companies that have reported topped analyst expectations, FactSet data shows. Adobe surged 5% on Tuesday after the software company issued better-than-expected guidance for fiscal year 2020.
The U.S. trade deficit with its global partners contracted to $52.5 billion in September as the U.S. and China worked towards a tariff truce, according to a Commerce Department report Tuesday.
Shares of Walgreens Boots Alliance rose 2.6% on reports the company has been exploring a deal to go private.
- CNBC's Elliot Smith and Fred Imbert contributed to this report.