Global equity markets rallied on Monday following conciliatory remarks from former US President Donald Trump that helped calm renewed tensions between Washington and Beijing. The softer tone lifted investor confidence across Asia and Europe, with Tokyo stocks hitting a record high amid signs of political stability in Japan.
The rebound came as data showed China’s economy expanded in line with expectations during the third quarter, helping sustain the positive momentum from Wall Street, where all three major indices recovered from last week’s losses.
Market sentiment had faltered earlier after a flare-up in trade hostilities, when Trump threatened to impose 100 per cent tariffs on Chinese goods in response to Beijing’s new restrictions on rare earth exports. The threats prompted retaliatory measures and uncertainty over a planned meeting between Trump and Chinese President Xi Jinping.
However, tensions appeared to ease over the weekend as both sides agreed to resume high-level talks. According to Chinese state media, Vice Premier He Lifeng and US Treasury Secretary Scott Bessent held “candid, in-depth, and constructive exchanges,” with plans for another round of negotiations “as soon as possible.”
Hours earlier, Trump told Fox News he would meet Xi at the upcoming APEC summit, describing the proposed 100 per cent tariff as “not sustainable.”
Asian markets responded positively to the developments. Hong Kong’s Hang Seng Index jumped over 2 per cent, while Shanghai’s Composite Index closed higher after China’s GDP data showed moderate but stable growth — its slowest pace in a year, yet within market forecasts.
Tokyo’s Nikkei 225 led regional gains, soaring more than 3 per cent to a record high after Japan’s ruling party announced a coalition deal paving the way for Sanae Takaichi to become the country’s first female prime minister. The move restored investor confidence following political uncertainty that had unsettled markets the previous week.
Elsewhere, major indices in Sydney, Seoul, Wellington, Taipei, Mumbai, Bangkok, and Manila also advanced, alongside early gains in London, Paris, and Frankfurt.
Chris Weston of Pepperstone noted that markets were now “priced for a positive, or at least less-bad, outcome,” with expectations that China would relax its export restrictions, enabling Washington to extend the current 30 per cent tariff truce beyond its November 10 deadline.
Investor sentiment was further buoyed by a recovery in US regional bank stocks on Friday after steep declines a day earlier. Zions Bancorp and Western Alliance Bancorporation led the rebound, easing fears of broader financial sector contagion.
Key market figures (as of 0715 GMT):
Tokyo – Nikkei 225: Up 3.4% at 49,185.50 (close)
Hong Kong – Hang Seng Index: Up 2.3% at 25,838.94
Shanghai – Composite: Up 0.6% at 3,863.89 (close)
London – FTSE 100: Up 0.3% at 9,382.39
Currencies:
Euro/Dollar: $1.1664 (down from $1.1670 Friday)
Pound/Dollar: $1.3423 (down from $1.3433)
Dollar/Yen: 150.59 yen (up from 150.50 yen)
Euro/Pound: 86.87 pence (down from 86.88 pence)
Commodities:
WTI Crude: Down 0.9% at $57.01 per barrel
Brent Crude: Down 0.9% at $60.77 per barrel
New York – Dow Jones Industrial Average: Up 0.5% at 46,190.61 (close)
