Global stocks climb on US-China tariff relief
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More news: Markets around the globe lifted on news that the US and China substantially reduced tariffs as part of what had been an escalating trade war between the world’s two largest economies.
The numbers: The new agreement will see the US reduce tariffs on Chinese goods to 30% from 145% for 90 days while China will lower levies on US goods to 10% from 125% for the same period.
Equities pushed up on Monday, with S&P 500, Nasdaq and DOW futures rising 2.7%, 3.5% and 2% respectively. The Hang Seng index pushed up 5.2% at the close, its biggest gain in two months, while the Stoxx Europe 600 rose 1.2% in early trading, led by shipping giant Maersk which rose 12% on the news.
On Wall Street, Nvidia rose 4.5% and Nike climbed 5% in premarket trading.
The US dollar also rose 1.2% against a basket of its peers while the yuan strengthened 0.5%. Prices for gold fell off 2.8% while the Swiss franc and Japanese yen safe havens weakened 1.5% and 1.6% respectively.
Brent crude futures gained 2.8% to US$65.71 ($102.67) per barrel.
US and China to lower respective tariffs for 90 days
The news: The US and China will temporarily lower tariffs on each other’s goods, according to a joint statement from the two countries.
The numbers: The US will cut tariffs on Chinese goods to 30% from 145% for 90 days while China will lower levies on US goods to 10% from 125% for the same period.
The announcement triggered a rally in the US dollar to one-month highs.
What they said: Bloomberg reported that during a joint press conference in Geneva, US Treasury Secretary Scott Bessent said: “We have reached an agreement on a 90-day pause and substantially moved down the tariff levels”.
The context: On Sunday, US President Donald Trump said “great progress” had been made during the first day of trade talks with China, as the countries sought to reach an agreement after escalating tariffs triggered mayhem across global markets and supply chains.
The sources: Bloomberg, Joint statement, FT
