U.S. stocks were poised to rebound on Monday, after logging their worst weekly performance in more than two years. The gains were spurred by reports that the U.S. and China officials are conducting behind-the-scenes talks to avert a global trade war.

A handful of Federal Reserve speakers may capture attention as well, as a holiday-shortened week of trading kicks off.

What are the main benchmarks doing?

Dow Jones Industrial Average futures YMM8, +1.01% rose 213 points, or 0.9%, to 23,818, while S&P 500 futures ESM8, +1.13% gained 25.20 points, or 0.9%, to 2,623. Nasdaq-100 futures surged 81.75 points, or 1.3%, to 6,636.

Fears of a trade war hung over markets on Friday, driving the Dow Jones Industrial Average DJIA, -1.77% to its lowest close of 2018. The index shed 424.69 points, or 1.8%, to reach 23,533.20 and took out its previous closing low, set in early February.

Sliding more than 1,400 points, the Dow tumbled 5.7% for the week, while the S&P 500 Index SPX, -2.10% and Nasdaq Composite Index COMP, -2.43% indexes lost 6% and 6.5%, respectively.

All three indexes suffered their worst weekly returns since January 2016, when fears of a global economic rout dogged sentiment.

What’s driving markets?

Global trade tensions are expected to remain front and center for investors in what will be a holiday-shortened week, with markets scheduled to close in observance of Good Friday.

But equity traders seem to be taking some cheer in reports that China and the U.S. have been holding discussions, in a bid to help stave off a trade war.

Those talks, led by U.S. Treasury Secretary Steven Mnuchin and Liu He, China’s vice premier for economic policy, are aimed at providing better access to Chinese markets for U.S. companies. Tensions ratcheted up last week after the Trump administration declared tariffs on certain Chinese goods and China fired back with its own trade-related clampdown.

Mnuchin told Fox News on Sunday that he was “cautiously hopeful” an agreement can be reached with China.

Meanwhile, the U.S. and South Korea have reached a deal that will give the Asian country a permanent exemption from trade tariffs.

Read: The Dow may be at the mercy of politicians until earnings season

What are strategists saying?

• “The last two months have seen global sentiment become more fragile, but the one thing that has kept markets going is the reliance on investors to buy on the dips. The last week had undermined that position, in what was a worrying sign for the wider markets, but investors appear to be feeling slightly more resilient this morning,” said Rebecca O’Keeffe, head of investment at Interactive Investor, in a note to clients.

“Steve Mnuchin has taken on the unenviable task of attempting to resolve the trade dispute between the US and China via negotiation — however, he may be trying to reconcile the irreconcilable,” she added.

• “The trade war is increasingly looking like a phony war. Even if U.S. trade policy is more spin than substance, increasing uncertainty does have implications for markets. Friday’s budget veto hokey-cokey dance was also unsettling for investors. Market volatility is therefore likely to continue,” said Paul Donovan, global chief economist at UBS, in a note to clients.

What is on the economic docket?

It’s a quiet day for data reports, with just the Chicago Fed national activity index for February due for release at 8:30 a.m. Eastern Time. But the week will also deliver a fresh look at inflation via an upate on the PCE index, the Federal Reserve’s preferred gauge, on Thursday.

Read: Is the pressure off? Inflation likely to die down in February, but don’t get used to it

On Monday, New York Federal Reserve President William Dudley is scheduled to speak on regulatory reform in Washington, D.C. at 12:30 p.m. Eastern. Fed Vice Chair Randal Quarles is due to speak on consumer protection and small business at a forum in Atlanta at 7:10 p.m. Eastern.

Read: John Williams may be named New York Fed president: report

What stocks are in focus?

Facebook Inc. FB, -3.34% shares were pitching lower in thin premarket trading. The company is continuing with do damage control after the Cambridge Analytica data-privacy scandal, and took out full-page ads in nine U.S. and U.K. newspapers. The backlash has triggered a #DeleteFacebook movement.

Facebook shares tumbled 14% last week.

Read: John Williams may be named New York Fed president: report

What are other markets doing?

European equities SXXP, +0.24% traded mostly higher. Asian markets finished mixed, as losses eased toward the close, and the Korean Kospi Composite Index ended 0.5% higher after news of the U.S. trade agreement.

The ICE U.S. Dollar Index DXY, -0.23% eased slightly, while gold GCJ8, -0.07% dipped 0.2% to $1,346.70 an ounce.

Oil futures CLK8, -0.41% pulled back 0.5% to $65.55 a barrel.

Read: China aims to shake up oil-futures market with own contract