Following a breakthrough in high-level trade talks between China and the U.S. in Geneva, Switzerland, global capital markets kicked off the week with a strong rally.
China’s lead negotiator, Vice Premier He Lifeng, stated on the evening of the 11th that the talks were “candid, in-depth, and constructive,” with both sides reaching key consensuses and achieving substantive results. U.S. Treasury Secretary Janet Yellen confirmed in parallel that “significant progress” was made in the negotiations.
The positive signals from the world’s two largest economies quickly ignited investor sentiment. Wall Street and Asian markets rose in tandem, safe-haven assets and forex markets fluctuated, and global investors are closely watching whether this “tariff truce” will bring an end to years of trade uncertainty.
U.S. Futures Surge, Tech Stocks Lead
On Monday, all three major U.S. stock index futures opened higher. At press time, S&P 500 futures were up 1.35%, Dow Jones futures rose 1.05%, and Nasdaq futures led with a 1.83% gain. Semiconductor and renewable energy sectors — both sensitive to China-U.S. trade relations — performed strongly.
Market analysts believe that if the two countries can reach phased agreements on issues like semiconductor export controls and clean energy cooperation, it will directly benefit related supply chain companies. Michael Brown, senior strategist at Pepperstone, noted, “The current negotiation framework has far exceeded market expectations. The two sides may leverage this to advance a broader trade agreement, which is key to supporting tech stock valuations.”
Asian Markets Follow Suit, Yuan Assets Strengthen
Asian-Pacific equity markets extended gains. Japan’s Nikkei 225 opened up 0.53%, with semiconductor equipment maker Tokyo Electron rising over 2%. South Korea’s KOSPI rose 0.7%, and Samsung Electronics hit a nearly three-month high.
Chinese assets also performed well. FTSE China A50 index futures, after a 0.04% drop in the night session, opened higher in the morning. The Hang Seng Index rose over 1%, and China’s A-shares opened broadly higher. The ChiNext Index gained 1.4%, led by export-driven sectors such as solar energy and new energy vehicles. Notably, the offshore RMB appreciated more than 150 basis points against the U.S. dollar during the day, reflecting increased expectations of improving cross-border capital flows.
Dollar’s Safe-Haven Appeal Eases, Inflation Data in Focus
As risk appetite improved, the U.S. Dollar Index rose 0.21% to 104.3 during Asian trading hours, though gains versus traditional safe-haven currencies like the yen and euro narrowed.
Chris Weston, head of research at Pepperstone, noted signs of “early positioning” by dollar bulls in the interbank forex market, but warned of potential volatility from this Thursday’s release of the U.S. April core CPI data. Economists at ANZ suggested that if month-over-month CPI growth comes in below 0.3%, it will strengthen market bets on Fed rate cuts within the year. Conversely, if tariffs push up import prices, the Fed may be forced to delay policy easing.
Caution Amid Optimism: Tariff Risks Persist
Despite Monday’s broad-based market rally, analysts remain cautious about the long-term outlook for China–U.S. relations. Trade policy experts warned that former President Donald Trump has repeatedly stated he would impose a 60% tariff on Chinese goods if reelected, which could jeopardize the implementation of any agreements reached now.
Billionaire and Barstool Sports founder Dave Portnoy joked on social media that “the stock market is turning into a movie,” expressing a bullish stance. However, he himself reportedly lost 20% of his net worth due to Trump-era tariffs, highlighting the fragile balance between investor optimism and policy risk.
At present, global investors are watching closely to see whether the Geneva consensus can be translated into an actionable roadmap. If future talks focus on concrete issues such as EV tariff exemptions and cross-border data flows, this rally may be sustainable. If trade tensions flare up again, markets may fall back into the “hope-disappointment” cycle seen since 2018.
