"Things are going very well with China and with trade", he told reporters at the White House, adding that he had seen some "false reports" indicating that USA tariffs on Chinese products would be lifted.
Will China end trade imbalance with US?
Earnings season picks up pace with 11 percent of S&P 500 companies having already posted fourth-quarter results and another 12 percent due to report results in the upcoming holiday-shortened week.
The Dow Jones Industrial Average jumped 162.94 points, or 0.67 percent, to 24,370.10.
Stocks jumped on news that China were considering increasing its annual goods imports from the U.S. to over $1tr as it bids to reduce its trade surplus to zero by 2024, according to Bloomberg.
ANALYST'S COMMENT: Markets have welcomed "the latest indication of further interest from the U.S.to resolve the U.S".
The dollar was also boosted by increased optimism over trade, with the dollar index rising 0.31 per cent, while the Euro was down 0.26 per cent to $1.1365.
Mickelson flirts with 59 in 1st start of season
The tournament is played out over three courses during its four days with La Quinta considered the easiest of them. The round ties a career low and makes Mickelson the first golfer with three rounds of 60 in his PGA career.
Wall Street was set for a fourth week of gains, with foreign trade-sensitive industrials up 1.6% and leading sector gains for the S&P 500. The Nasdaq composite added 72.76 points, or 1 percent, to 7,157.23.
President Donald Trump a year ago imposed tariffs on Chinese industrial and consumer goods as leverage in talks aimed at shrinking the U.S. trade deficit and forcing China to abandon discriminatory trading practices.
Disputes over trade are more typically dealt with through courts, the World Trade Organization (WTO) or through arbitration panels and other dispute settlement mechanisms built into trade agreements. The two countries have raised taxes on billions of dollars of each other's goods in the spat over the trade deficit, Beijing's manufacturing plans, and US complaints that China steals technology from foreign companies.
Entering this year, weakness in the United States dollar was a consensus view among currency market traders.
ENERGY: Benchmark U.S. crude 53 cents to $52.60 per barrel in electronic trading on the New York Mercantile Exchange.
Particularly with regard to our trade with China, which accounts for the biggest portion of our trade deficit, Trump doesn't buy the orthodox rationale.
In other commodities trading, wholesale gasoline rose 1.6 percent to $1.45 a gallon and heating oil added 1.6 percent to $1.92 a gallon.
Chinese exports to the United States held up through much of 2018 despite Trump's tariff hikes but contracted by 3.5 percent in December compared with a year earlier as the penalties began to depress demand.