Stocks rose globally after the US and China concluded three days of trade talks and appeared to be closer to agreement on a number of areas. The dollar dipped and Treasuries were steady as investors awaited the release of minutes from the Federal Reserve’s December meeting, which may offer insight into the decision to raise rates and the pace of future hikes.
All major US equities benchmarks were higher. The S&P 500 Index was up as energy shares gained with West Texas crude breaking above $50 a barrel. And strength in semiconductors helped move the Nasdaq gauges higher.
The Stoxx Europe 600 Index climbed to the highest in a month led by carmakers and miners, while Hong Kong stocks set the pace for Asian benchmarks. And most industrial metals advanced after the Asian nation signaled measures to spur consumption.
Trade developments between the US and China remain a focal point, with Trump reportedly eager to strike a deal to help revive the flagging stock rally he took credit for. However, the two countries remain far apart on certain key issues. And Chinese and American officials are reportedly coordinating their messaging to make sure markets interpret the results of the meeting optimistically.
Meanwhile, the US government remains partially shut down as a televised address by President Donald Trump failed to convince opponents of his plan to build a wall along the Mexican border, which is at the center of the dispute.
While concerns linger about how protectionist tensions and political instability in the world’s largest economy will affect global growth, they also set up a potential Goldilocks scenario for markets after Fed Chairman Jerome Powell’s apparent dovish shift last week eased fears about tightening financial conditions.
“We could get some more stabilisation and a floor in the market if we make strides toward an agreement” on trade, Kate Moore, chief equity strategist at BlackRock, said on Bloomberg Television.
Elsewhere, emerging-market stocks extended a rally that’s taken MSCI’s gauge to the highest in more than a month. The Bloomberg Commodity Index rose for a sixth straight day, and gold ticked higher.
Wednesday sees the release of minutes from the Fed’s Dec. 18-19 policy meeting. Powell will speak to the Economic Club of Washington on Thursday. Britain’s Parliament resumes a debate on the Brexit withdrawal bill, with PM Theresa May seeking to avoid defeat in a vote set for the week of January 14.
The S&P 500 was up 0.4 percent in New York. The Stoxx Europe 600 Index increased 0.9 percent to the highest in almost four weeks. The MSCI All-Country World Index advanced 0.9 percent. The UK’s FTSE 100 Index climbed 1.2 percent to the highest in five weeks. The MSCI Emerging Market Index jumped 1.9 percent in five weeks.
The Bloomberg Dollar Spot Index dipped 0.5 percent. The euro gained 0.1 percent to $1.145. The British pound climbed 0.1 percent to $1.2732.
The yield on 10-year
Treasuries was little changed at 2.7297 percent.