Stocks popped higher to start October as investors placed bets that talks between Congress and the White House would lead to a fresh round of stimulus for a U.S. economy battered by the coronavirus pandemic.

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 The Dow Jones Industrial rose 173 points or 0.6% hitting the key psychological 28,000 level, while the NASDAQ Composite and S&P 500 saw gains of 1.1% and 0.75% respectively.

U.S. weekly jobless claims came in at 837K slightly lower than the 850K that was expected but still elevated. Investors are also looking ahead to Friday's jobs data in which unemployment is expected to drop to 8.2% as employers added an estimated 850,000 jobs.

Personal Consumption rose 1% stronger than expected, as consumers spend, but income dipped -2.7%. And core PCE for August rose 0.3%.

Investors are also watching ongoing stimulus talks between House Speaker Nancy Pelosi and Secretary of the Treasury Steven Mnuchin, who told FOX Business, the Trump administration would not agree to the $2.2 trillion stimulus deal put forth by congressional Democrats. Instead, President Trump instructed his negotiators to go above and beyond the Republican's initial $1 trillion offer, which Mnuchin described as "in the neighborhood" of $1.5 trillion. Read more at FOX Business