TORONTO -- North American stock markets were up with U.S. exchanges setting record intraday highs Thursday on signals about an impending trade deal between the world's two largest economies.

Investors responded positively after U.S. President Donald Trump made some of his most positive remarks to date on the 17-month trade war with China.

"Getting VERY close to a BIG DEAL with China. They want it, and so do we!," he tweeted.

Trump's affirmation that he also wants a deal drove market sentiment, said Allan Small, senior investment adviser at HollisWealth.

"That's the first time that he's used that phrase: So do we. It's always been China wants a deal and he'll see if he wants to make one. So very big difference in tone from the president," he said in an interview.

Published reports suggest the U.S. is offering to cancel new tariffs set to start Sunday and reduce existing levies but reimpose them if China doesn't honour the deal.

U.S. officials haven't publicly commented on the details of a deal in principal the two sides allegedly reached.

The S&P/TSX composite index closed up 7.29 points at 16,946.90 after hitting an intraday high of 17,031.88.

In New York, the Dow Jones industrial average was up 220.75 points at 28,132.05 after hitting 28,224.95 in earlier trading. The S&P 500 index closed up 26.94 points at 3,168.57 after hitting 3,176.28, while the Nasdaq composite was up 63.27 points at 8,717.32, short of the record 8,745.82 reached earlier in the day.

"It's all about trade," Small said about markets reaching new records.

The Canadian dollar traded for 75.86 cents US compared with an average of 75.75 cents US on Wednesday.

Health care was the leading sector on the day. It surged 5.6 per cent as shares of Bausch Health Companies rose 8.7 per cent and cannabis producers the Green Organic Dutchman Holdings Ltd., Cronos Group Inc. and Aurora Cannabis Inc., climbed 7.9, 7.2 and 6.8 per cent respectively.

Energy was up more than two per cent on higher crude and natural gas prices with Encana Corp. up 3.8 per cent and Canadian Natural Resources 3.2 per cent higher.

The January crude contract was up 42 cents at US$59.18 per barrel and the January natural gas contract was up 8.5 cents at US$2.33 per mmBTU.

Materials rose slightly even though gold prices fell amid the trade optimism.

"If you eliminate fear then gold should fall," said Small.

The February gold contract was down US$2.70 at US$1,472.30 an ounce and the March copper contract was up 0.7 of a cent at US$2.80 a pound.

Defensive sectors such as consumer staples, real estate and utilities were lower.

"When you see a trade deal on the table nobody wants to buy the boring stuff," he added. "They all want to buy the sexy semi-conductors, technology, or anything to do with U.S.-China trade."