World shares staged a cautious rally on Monday as investors held out for some progress in U.S.-China trade talks.

The MSCI All-Country World Index, which tracks shares across 47 countries, was up 0.2 percent. 

English-language Chinese newspaper Global Times on Monday said on Twitter, China and the United States were "very close" to an initial trade agreement.

U.S. stocks end higher on trade hopes

U.S. stocks wrapped up Monday on an encouraging note, with the three major indexes hitting record high. 

The Dow Jones Industrial Average increased 190.85 points, or 0.68 percent, to 28,066.47. The S&P 500 rallied 23.35 points, or 0.75 percent, to 3,133.64. The Nasdaq Composite Index climbed 112.60 points, or 1.32 percent, to 8,632.49. 

Widely-watched trade bellwethers also led gains in the 30 blue-chip stocks in the Dow, with shares of Intel and Caterpillar gained 2.08 percent and 1.77 percent respectively at market close. 

Ten of the 11 primary S&P 500 sectors traded higher around the closing bell, with information technology up 1.35 percent, outperforming the rest. 

Shares of Tiffany rose by 6.17 percent after French luxury goods conglomerate LVMH reached a deal to acquire the company for 16.2 billion U.S. dollars.

U.S. stocks declined last week amid the release of a wave of economic data and minutes from the Federal Reserve. 

The Dow had its first weekly pullback in over a month, with a loss of 0.46 percent. The S&P 500 fell by 0.33 percent, snapping a six-week winning streak. The Nasdaq dropped by 0.25 percent, ending a seven-week winning streak.

The benchmark Shanghai Composite Index up 0.72 percent, at 2,906.17 points, while the Shenzhen Component Index closed 0.01 percent lower at 9,626.36 points.

Combined with yesterday's announcement by the Chinese government calling for intensified protection of intellectual property rights, which is in the center of the trade dispute, the trade optimism outweighs some of the less optimistic common trade.

Companies in coal mining industry posted strong performance, while shares related to transportation and computer application services led the losses.

Hong Kong stock markets rose solidly on China-U.S. trade hopes and Hong Kong's local elections.

The Hang Seng index jumped by 1.50 percent, or 397.96 points, to 26,993.04. Industrial, energy and tech shares bolster the index. However, since June 10, when the unrest in the Asian financial hub has began, the Hang Send index has dropped by 3.75 percent to date.

MSCI's broadest index of Asia-Pacific shares outside Japan bounced by 0.7 percent, after losing 0.4 percent last week. 

Japan's Nikkei firmed 0.7 percent. The leading gainers are IT and industrial equipment sectors.

French luxury goods group LVMH's deal to buy U.S. jewelry firm Tiffany also boosted European shares to a one-week high, while optimism on U.S.-China trade issues also lifted investor sentiment.

Britain's FTSE100 index was up 0.7 percent, Germany's DAX rose by 0.5 percent, and France's CAC40 index was up 0.6 percent.

(With input from Reuters, AFP and Xinhua)