Stocks Rally on Trade Optimism Ahead of Big Week: Markets Wrap
(Bloomberg) — Global equities rallied as signs that the US and China were closing in on a trade deal stoked optimism at the start of a bumper week in which the Federal Reserve and tech megacap earnings will also shape markets.
The S&P 500 was on track to extend its record run, with futures up 0.8%, after US and Chinese negotiators said over the weekend they had reached a series of agreements ahead of a high-stakes meeting between Donald Trump and Xi Jinping. Asian stocks hit an all-time high, while a European gauge was little changed.
Gold slipped and Treasuries fell across the curve as demand for traditional havens waned. The dollar held firm, with the Swiss franc the weakest among major peers.
Easing trade tensions between the world’s largest economies are giving investors fresh confidence to extend equities’ rally from April lows, when markets slumped as Trump moved to rewrite global trade rules. That advance faces key tests this week, with the Fed expected to cut interest rates and earnings from Magnificent Seven firms set to offer clues on the durability of profit growth.
“The shift of attention to the negotiations with China is causing the markets to open higher, but only a positive outcome will be sustainable,” said Guillermo Hernandez Sampere, head of trading at asset manager MPPM. “This week could be crucial for the course of the rest of the year, with the greatest focus on the Federal Reserve’s wording regarding monetary policy.”
Top negotiators from the US and China came to terms on a range of contentious points, setting the table for Trump and Xi to finalize a deal and ease trade tensions that have rattled global markets.
The Chinese Communist Party’s official mouthpiece called on the world’s biggest economies to “jointly safeguard hard-won achievements” from their latest trade talks, ahead of a high-stakes meeting between Trump and Xi.
What Bloomberg strategists say…
There will be very few willing now to take the risk of missing out on a relief rally given the positive noises coming from both the US and China. There are other drivers that will help spur investors to pile into stock markets — a Fed rate cut is priced in for this week’s meeting, and investors are anticipating that earnings from tech giants will reinforce the AI boom as a key driver for broader market gains.
“While sentiment appears optimistic, the ultimate market impact will depend on the Trump-Xi meeting,” said Dilin Wu, a strategist at Pepperstone Group. “This event remains the most critical catalyst, determining whether any agreement can actually be implemented.”
The encouraging signals from both sides of the negotiations were a marked contrast from recent weeks, when Beijing’s announcement of new export restrictions and Trump’s reciprocal threat of staggering new tariffs threatened to plunge the two countries into an all-out trade war.
Elsewhere, Argentine assets are set to rally as President Javier Milei’s strong showing in legislative elections beat even the most bullish of forecasts, easing investor concern his economic overhaul of the crisis-prone nation would stall.
Indonesian stocks tumbled by their most in over six months after an MSCI Inc. consultation paper raised concerns about a potential re-weighting of local shares.
Separately, Treasury Secretary Scott Bessent said the candidate pool for the next Fed chair has been narrowed to Christopher Waller, Kevin Warsh, Kevin Hassett, Michelle Bowman, and Rick Rieder.
Bessent, who is leading interviews for the position, said he’s planning to do a second round of interviews and hopes to present a “good slate” to Trump after the Thanksgiving holiday.
Traders will be looking ahead to a busy week of central bank announcements that includes rate decisions from the Fed, the European Central Bank and the Bank of Japan.
Meanwhile, on Wednesday and Thursday, five firms that account for about a quarter of the S&P 500 Index — Microsoft Corp., Alphabet Inc., Meta Platforms Inc., Amazon.com Inc. and Apple Inc. — will report their earnings.
Catalysts such as the Fed meeting “will quickly shift the market’s focus back to the economic fundamentals, testing how much of this optimism can truly translate into sustained growth momentum,” said Hebe Chen, an analyst at Vantage Markets in Melbourne.
Corporate News:
Barclays Plc is re-entering Saudi Arabia, becoming the latest bank to beef up operations in the oil-rich kingdom that’s in the midst of a trillion-dollar economic transformation plan. Novartis AG agreed to buy biotechnology company Avidity Biosciences Inc. in a deal that values it at $12 billion, according to the Swiss drugmaker, making it the company’s biggest acquisition in more than a decade. HSBC Holdings Plc said it sees a provision of $1.1 billion on litigation related to claims against investors who lost money in Bernard Madoff’s fraud. Boeing Co. factory workers in St. Louis narrowly rejected a new five-year contract that would boost wages by an average of 24%, extending a nearly three-month strike that has disrupted the company’s main military manufacturing hub. Seres Group Co. started taking investor orders for a Hong Kong listing that may raise as much as HK$13.2 billion ($1.7 billion), making the electric-vehicle maker the latest big Chinese company to go public in the financial hub. Some of the main moves in markets:
Stocks
The Stoxx Europe 600 was little changed as of 8:24 a.m. London time S&P 500 futures rose 0.8% Nasdaq 100 futures rose 1.1% Futures on the Dow Jones Industrial Average rose 0.6% The MSCI Asia Pacific Index rose 1.5% The MSCI Emerging Markets Index rose 1.3% Currencies
The Bloomberg Dollar Spot Index was little changed The euro was unchanged at $1.1627 The Japanese yen was little changed at 152.92 per dollar The offshore yuan rose 0.2% to 7.1128 per dollar The British pound was little changed at $1.3319 Cryptocurrencies
Bitcoin rose 1.9% to $115,528.2 Ether rose 3.2% to $4,191 Bonds
The yield on 10-year Treasuries advanced two basis points to 4.03% Germany’s 10-year yield was little changed at 2.63% Britain’s 10-year yield advanced one basis point to 4.44% Commodities
Brent crude was little changed Spot gold fell 1.3% to $4,058.71 an ounce This story was produced with the assistance of Bloomberg Automation.
–With assistance from Eman Abouhassira.
©2025 Bloomberg L.P.
