MSCI’s broadest index of Asia-Pacific shares outside Japan was 0.35% higher at 727.82, hovering near the 4-1/2-year high it hit last week

Asian stocks gained on Monday as the China-U.S. trade truce and soaring spending on artificial intelligence kept risk sentiment aloft, while the dollar held near a three-month high after hawkish comments from U.S. central bank’s policymakers.

Investors are still focused on developments from last week, including China-U.S. trade agreement on a year-long trade truce that was within broad expectations. But doubts remain if the truce will last for the full duration.

MSCI’s broadest index of Asia-Pacific shares outside Japan was 0.35% higher at 727.82, hovering near the 4-1/2-year high it hit last week. The index is up more than 27% this year, on course for its best year since 2017.

China’s blue-chip stocks eased 0.6% after data showed China’s factory activity in October expanded at a slower pace than in September as new orders and output both dropped amid tariff anxiety. Hong Kong’s Hang Seng Index was 0.3% higher.

We advise investors to lock in some gains on the rises and accumulate on the corrections, and rotate into more defensive positioning toward year end, said BofA strategists, noting that optimism tied to the China-U.S. trade truce has been priced in.

Japan markets are closed for a holiday with no cash Treasuries trading, resulting in muted activity during Asian hours.

A number of U.S. central bank presidents on Friday aired their discomfort with the bank’s decision to cut interest rates, even as influential central bank Governor Christopher Waller made the case for more policy easing to shore up a weakening labour market.

Nasdaq futures were 0.25% higher, while European futures also pointed to higher open.