Stocks Waver as Trump Meets With Xi, Bonds Gain: Markets Wrap
(Bloomberg) — Asian equities swung between small gains and losses as the US and China held their summit, with traders looking to the meeting for clues on the trajectory of trade ties between the world’s two largest economies.
MSCI’s Asia Pacific equities index was 0.1% higher, having risen as much as 0.8% in early trading. Shares in mainland China fell 1.3%, having touched their highest level since 2021 ahead of the talks between US President Donald Trump and China’s Xi Jinping in Beijing. The offshore yuan edged up for a 11th day, the longest winning streak since September 2017.
Artificial intelligence trade remained in focus with a gauge of Asian technology shares climbing as much as 2.3% to a record. US equity-index futures advanced with contracts for the Nasdaq 100 Index climbing 0.3%. Cisco Systems Inc. shares jumped 20% in extended trading after a stronger-than-expected sales outlook. European shares were set for a 0.7% advance.
Optimism for tech and stocks masked worries about inflation that have driven bets the Federal Reserve will raise interest rates next year. Treasuries rose, with the US 10-year yield slipping one basis point to 4.46%, while Australia’s government bonds also gained.
Equities globally have pushed to record highs, supported by robust corporate earnings and expectations that AI-driven spending will sustain growth. Traders are also focused on geopolitical developments in Iran and the meeting between Xi and Trump for their potential impact, as concerns mount that the war in the Middle East may keep inflation elevated and weigh on the global economy.
“If there is any kind of breakthrough, including sales of semiconductors to China, there would be a boost to market sentiment,” Homin Lee, strategist at Lombard Odier, said in a Bloomberg Television interview. “But even a low impact summit that keeps peace is good enough for the market.”
Trump said China and the US will have a “fantastic future” and Xi stressed partnership over rivalry in their meeting, setting a positive tone for the first visit by a sitting US president to Beijing in nearly a decade.
Trump highlighted the business delegation joining his trip that includes Nvidia Corp.’s Jensen Huang and Tesla Inc.’s Elon Musk. Huang said the meetings in Beijing ‘went excellent.” Xi told US business leaders that China will open its door wider.
China’s CSI 300 Index dropped 1.3% and the main gauge in Shanghai declined 1%.
“It’s a classic buy the news and sell the facts,” said Billy Leung, an investment strategist at Global X Management.
What Bloomberg Strategists Say…
“There is the risk of investors pricing in too much of a warm glow from the Beijing discussions. Should there be any sign of disagreement on trade or geopolitical issues between the two leaders, that would deliver an unwelcome jolt to the buoyant sentiment across markets.”
— Mark Cranfield, MLIV. For full analysis, click here.
Separately, the Senate narrowly confirmed Kevin Warsh as chair of the Fed, setting up the most controversial leadership transition at the US central bank in decades and a test of its political independence.
In other corners of the market, Brent crude traded around $106 a barrel after falling 2% in the previous session, while West Texas Intermediate was near $101. The dollar was little changed after strengthening over the past three days.
Elsewhere, US inflation reports this week have shown mounting price pressures, pushing traders to boost wagers on a Fed rate hike in the coming year. The yield on 10-year Treasuries rose to the highest since July on Wednesday.
US wholesale inflation accelerated in April to the fastest pace since 2022 on a war-driven increase in energy prices that’s feeding into higher freight transportation costs. The producer price index rose 6% from a year ago, according to Bureau of Labor Statistics data out Wednesday, eclipsing economist estimates and coming in after a hot consumer price readout.
“One takeaway is that companies are not passing through costs to consumers across the board just yet,” said Chris Low at FHN Financial. “But company input costs are sharply higher, which obviously increases pressure to pass through costs in future.”
Corporate Highlights:
Cerebras Systems Inc. raised $5.55 billion in its US initial public offering, as the artificial intelligence chipmaker seizes on the surging demand for semiconductors. Elon Musk’s xAI has recruited multiple Wall Street firms with ties to the billionaire’s business empire to test its Grok chatbot, according to people familiar with the matter, part of a push to bolster revenue ahead of parent company SpaceX’s initial public offering. Ford Motor Co. jumped after Morgan Stanley issued a bullish call that the automaker’s energy storage business could soon make a deal with hyperscalers. Some of the main moves in markets:
Stocks
S&P 500 futures rose 0.1% as of 1:52 p.m. Tokyo time Japan’s Topix fell 0.6% Australia’s S&P/ASX 200 fell 0.2% Hong Kong’s Hang Seng rose 0.3% The Shanghai Composite fell 1% Euro Stoxx 50 futures rose 0.7% Currencies
The Bloomberg Dollar Spot Index was little changed The euro was little changed at $1.1716 The Japanese yen was unchanged at 157.86 per dollar The offshore yuan was little changed at 6.7849 per dollar Cryptocurrencies
Bitcoin fell 0.4% to $79,381.7 Ether fell 0.3% to $2,255.23 Bonds
The yield on 10-year Treasuries was little changed at 4.46% Japan’s 10-year yield advanced 2.5 basis points to 2.615% Australia’s 10-year yield declined four basis points to 5.02% Commodities
West Texas Intermediate crude rose 0.4% to $101.43 a barrel Spot gold rose 0.3% to $4,704.11 an ounce This story was produced with the assistance of Bloomberg Automation.
–With assistance from Lin Zhu.
©2026 Bloomberg L.P.
