Stocks rally on China‑US truce, eyeing inflation data

Trump Extends China‑US Tariff Truce for 90 More Days

Stocks rallied worldwide as investors welcomed the extension of the trade truce between Washington and Beijing – a move that temporarily eased fears of a full‑scale economic standoff between the two largest economies.

Market Highlights

• Tokyo Nikkei 225 surged to a record high of 42,999.71 points after renewed optimism over Japan’s export‑heavy sector.
• London FTSE 100 gained 0.2 % to 9,145.76 points.
• Paris CAC 40 moved up 0.1 % to 7,707.11 points.
• Frankfurt DAX slipped 0.5 % to 23,971.50 points.
• New York Dow declined 0.5 % to 43,975.09 points.

Currency Movements

• Brent North Sea Crude climbed 0.4 % to $66.89 per barrel.
• West Texas Intermediate edged up 0.3 % to $64.16 per barrel.
• Euro/dollar fell to $1.1610 from $1.1617.
• Pound/dollar rose to $1.3459 from $1.3435.
• Dollar/yen increased to 148.43 yen from 148.12 yen.
• Euro/pound dipped to 86.28 pence from 86.47 pence.

Key Economic Factors

Investors are closely monitoring the upcoming U.S. CPI data – a figure that could heavily influence the Federal Reserve’s next interest‑rate decision. While expectations for a rate cut have increased, analysts warn that a higher-than‑forecast inflation reading could dampen those hopes.

Trump’s stance on Fed rates remains firm: he has urged the independent Fed to slash rates and has criticized Chairman Jerome Powell for keeping them unchanged. The president also anticipates a summit with Russian leader Vladimir Putin, though he has downplayed potential breakthroughs in ending the war in Ukraine.

Asian Economic Outlook

Tokyo’s Nikkei index’s brief 3 % surge reflects optimism over Japan’s economy after officials reached a deal to avert the worst of Trump’s tariffs. IwaiCosmo Securities notes that easing tensions over U.S.–China trade talks, coupled with speculation about an imminent U.S. interest‑rate cut, has boosted investor confidence in Japanese companies.

Asian Market Pulse

• Shanghai Composite ticked up 0.5 % to 3,665.92 points.
• Hong Kong Hang Seng advanced 0.3 % to 24,968.68 points.
• Australian markets lifted after the Reserve Bank of Australia announced a rate cut.

Investors watched trading activity resume after a long weekend, noting that the trade truce extension and potential interest‑rate changes are likely to influence buying decisions across global markets.