On Monday, Wall Street stock futures rose as optimism about U.S.-China trade negotiations emerged, sparking hopes of avoiding a global recession despite lingering uncertainties. Geopolitical tensions appeared to ease with a continued ceasefire between India and Pakistan, and Ukrainian President Volodymyr Zelenskyy expressed willingness to meet Russian President Vladimir Putin in Turkey for discussions.
In Geneva, U.S. Treasury Secretary Scott Bessent highlighted “substantial progress” in trade conversations, while Chinese officials reported reaching an “important consensus” and agreeing to establish a new economic dialogue forum. A joint statement was anticipated later, although specifics regarding tariff rates were absent. Michael Brown, a senior research strategist at Pepperstone, noted that the framework for further trade discussions was positive—but concrete outcomes remained elusive. He questioned whether tariffs could be paused or reduced.
Investors hoped for a reduction in the current 145% tariff on Chinese imports, potentially back to the 60% level suggested by President Donald Trump. However, Trump seems inclined to maintain high tariffs, which could hinder economic growth and raise prices. Positive steps in trade discussions, nonetheless, may mitigate a sharp economic downturn.
As a result, S&P 500 futures increased by 1.2%, while Nasdaq futures rose 1.4%, and European indices like EUROSTOXX 50, FTSE, and DAX also saw gains. Asian markets reflected similar trends with Japan’s Nikkei up 0.3% and South Korea’s Kospi rising 0.4%. Chinese blue chips strengthened by 0.8%, though data indicated steep declines in factory-gate prices and ongoing falls in consumer prices. The dollar gained 0.4% against the safe haven yen, edging closer to a recent peak, while also slightly rising against the euro and the offshore Chinese yuan.
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