US stocks closed mostly flat on Tuesday (4 April) as investors remain cautious ahead of a key meeting between US President Donald Trump and Chinese President Xi Jinping. Investors are also waiting for the jobs report to be released Friday (7 April).

The Dow Jones Industrial Average closed up 39.03 points, or 0.19%, to settle at 20,689.24. Shares of Caterpillar Inc, which rose 2% following a positive research note from Goldman Sachs, contributed the most to gains.

The S&P 500 index jumped 1.32 points, or 0.06%, to close at 2,360.16. According to MarketWatch, energy shares rebounded following two sessions of losses. WTI oil for May delivery rose $0.79, or 1.6%, to end at $51.03 a barrel, based on expectations for a decline in weekly crude inventories.

Meanwhile, the Nasdaq Composite Index moved up 3.93 points, or 0.07%, to settle at 5,898.61.

The two leaders are expected to meet at Trump's South Beach, Florida estate, Mar-a-Lago, on Thursday (6 April) and Friday. Trump previewed the meeting in a series of tweets on 30 March. "The meeting next week with China will be a very difficult one in that we can no longer have massive trade deficits and job losses. American companies must be prepared to look at other alternatives," he wrote.

Trump made fair US trade one of his key issue during the presidential campaign and has worked to make good on promises that the US would renegotiate trade deals he believes to be unfair, CNBC reported. The Trump administration has already taken steps to renegotiate the North American Free Trade Agreement with Mexico and Canada.

Stocks traded higher earlier on Tuesday after Trump indicated his administration would move forward with bank deregulation. "There's a lot of nervousness built into the market, but Trump's comments that we're going to get rid of 'horrible' regulations is bullish for stocks," Adam Sarhan, CEO of 50 Park Investments, told CNBC.

Investors are also looking ahead to the coming quarterly results and an employment report due Friday. Investors hope the reports will confirm that the month-long rally is supported by earnings and economic improvement, MarketWatch reported.

"There is an undercurrent of worries that the economy is losing momentum. Friday's employment report, particularly wage growth and the types of jobs being created, will be helpful [in providing] a hard data point in terms of the economy's trajectory, as well as the Fed's view of the economy and inflation," Quincy Krosby, a market strategist at Prudential Financial, said.

In economic news, the US trade deficit fell nearly 10% to $43.6bn in February due to an increase in exports to a 26-month high and a drop in imports of automobiles and cellphones. Factory orders met expectations and rose 1% in February, MarketWatch noted.

Treasury yields rebounded, with the benchmark 10-year yield near 2.35%. The US dollar was mostly flat on Tuesday, but traded lower against the yen to 110.75.