US STOCKS-Stocks rise on trade hopes, but off from earlier high

* Stocks climb after U.S., China agreed to restart talks
* Chipmakers surge on trade relief
* Dow up 0.15%, S&P 500 up 0.42%, Nasdaq up 0.73%

(Updates to mid-afternoon, changes byline)
By Chuck Mikolajczak
NEW YORK, July 1 (Reuters) - U.S. stocks climbed on Monday,
but were well off highs that sent the S&P 500 to a record,
fueled by gains in technology stocks on optimism for progress in
U.S.-China trade talks and signs of a likely reprieve for
Chinese telecom company Huawei.
The United States and China agreed on Saturday to resume
trade talks and U.S. President Donald Trump also offered
concessions including no new tariffs and an easing of
restrictions on Huawei Technologies Co Ltd HWT.UL , while China
agreed to make unspecified new purchases of U.S. farm products.
Still, stocks had given up more than half of their earlier
gains as enthusiasm waned and caution crept back in for
investors in what is likely to be a lightly traded week due to
the July Fourth holiday.
"It was kind of a relief rally but there is a lot of
unanswered question here," said Stephen Massocca, senior vice
president at Wedbush Securities in San Francisco.
"This is not going to get resolved because there was a lunch
in Osaka and given how mercurial our president is, who knows
what is going to throw him into a tizzy."
Tech stocks .SPLRCT , Wall Street's top performers so far
in 2019, jumped 1.07%, with heavyweight Apple Inc's AAPL.O
1.6% gain providing the maximum support.
Chipmakers with a sizable revenue exposure to China jumped
nearly 5% at their session high before also pulling back, last
showing a 1.99% gain in the Philadelphia Semiconductor index
.SOX . Huawei supplier Micron Technology Inc MU.O gained
3.3%.
The Dow Jones Industrial Average .DJI rose 40.03 points,
or 0.15%, to 26,639.99, the S&P 500 .SPX gained 12.39 points,
or 0.42%, to 2,954.15 and the Nasdaq Composite .IXIC added
58.70 points, or 0.73%, to 8,064.95.
Stocks saw their steepest sell-off this year in May after a
breakdown in the U.S.-China trade talks sparked concerns of a
global economic slowdown.
But hopes that the Federal Reserve would cut interest rates
to preserve a strong run of U.S. economic growth, and a dovish
turn by central banks around the globe, helped the S&P 500 and
the Dow Jones indexes post their best June performance in
decades.
Despite the latest development in talks, traders still
anticipate the Fed's next move will be a rate cut of at least a
quarter of a percentage point at its July 30-31 policy meeting.
Data showed growth in manufacturing cooled in the United
States in June while factory activity shrank across much of
Europe and Asia, further supporting expectations of a rate cut.
Gains on the Dow were held in check by a 2.4% drop in Boeing
Co BA.N after a report that federal prosecutors had subpoenaed
records relating to the production of the 787 Dreamliner in
South Carolina. Wynn Resorts Ltd WYNN.O jumped 6.7%, the most on the S&P,
as gambling revenue in the Chinese territory of Macau rose more
than expected in June. Shares of peers Melco Resorts &
Entertainment Ltd MLCO.O and Las Vegas Sands Corp LVS.N also
rose. Coty Inc COTY.N tumbled 14.8%, falling the most on the
S&P, after the company said it would overhaul its operations and
write down about $3 billion in value of its brands acquired from
Procter & Gamble Co PG.N . Advancing issues outnumbered declining ones on the NYSE by a
1.30-to-1 ratio; on Nasdaq, a 1.21-to-1 ratio favored advancers.
The S&P 500 posted 60 new 52-week highs and two new lows;
the Nasdaq Composite recorded 119 new highs and 24 new lows.