U.S. markets were up significantly Monday morning following the G20 summit this past weekend, where attention was focused on a meeting between the leaders of the United States and China, who are embroiled in a protracted trade war. Most analysts and economists expected a lot of posturing and not much action. But surprisingly, the two world leaders agreed to a trade truce for the time being, with Huawei even catching a break.

The S&P 500 gapped higher, rising 0.6% and reached an all-time high of 2,977.86. The Dow Jones Industrial Average gained 97 points, or 0.4% as Nike and Apple outperformed. The Nasdaq Composite rallied 1%.

“The markets appear to be content with the cooperative tone coming out of the meetings. To me, it felt like the contrarian play was to the upside post meetings,” said Dan Deming, managing director at KKM Financial. “There was a great deal of bearishness in sentiment headed into the meeting. Many market observers were discounting any change in the narrative, which made many believe the risk was to the downside.”

Still, despite the initial enthusiasm, the major indexes tempered their gains around midday. Ans, if it weren’t for some key gains from technology stocks on the news of the Huawei amnesty, it would likely be a typical, marginally higher market day that simply reflected the trade truce.

“There was a fair amount of exuberance at the open. I don’t know if it was celebrating good news or the absence of bad news,” said Willie Delwiche, investment strategist at Baird. “Either way, we started strong. The problem is, while we had a new high on the S&P 500, the number of individual stocks making new highs was shy of what we say back in late June,” when the index made its latest record close.

 “I don’t want to overstress the importance of it, but it is not confirming the index-level highs,” Delwiche said.
Jim Cramer believes perhaps there was something more profound that was being reflected in the president’s reversal on Huawei, which less than two months ago the Trump administration effectively blacklisted from doing business in the U.S., citing national security concerns.

“For the president to turn around like this, it must have meant there is something afoot,” Cramer said on “Squawk on the Street.” “Much bigger than anyone realizes,” he added.

People who don’t believe something is “afoot,” Cramer said, think “the president got had.”

“The president’s people are shocked,” Cramer said. “There was both the concessions and also the trip to North Korea,” he said of the spontaneous visit to meet leader Kim Jong Un.

However, top White House economic advisor Larry Kudlow on Sunday defended Trump’s Huawei decision, noting that the blacklist was still in place.

“This is not a general amnesty,” Kudlow said in an interview with Fox News. “Huawei will remain on the so-called entity list where there are serious export controls and in national security inferences or suggestions there won’t be any licenses.”

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