Global stocks extended their advance on Monday, with Wall Street heading for new records and Asian markets buoyed by renewed optimism over U.S.-China trade talks. Investors are looking ahead to a packed week of potentially market-moving events, including quarterly results from major technology companies and a Federal Reserve meeting on interest rates.
In early trading Monday, the S&P 500 was up 0.9%, the Dow Jones industrial average gained 296 points, and the Nasdaq composite gained 1.4%. Futures for all three indexes had already pointed higher earlier, reflecting expectations for new highs after President Donald Trump expressed confidence in reaching a trade deal with China.
Technology stocks led the gains. Nvidia rose 2.5% and Micron rose 4.1%, boosted by expectations of stronger chip demand if tensions between Washington and Beijing ease. Keurig Dr Pepper jumped 3.7% after beating third-quarter profit estimates and offering upbeat guidance for the rest of the year.
The development comes ahead of a planned meeting between Trump and Chinese President Xi Jinping on Thursday at the Asia-Pacific Economic Cooperation (APEC) summit in South Korea. Investors hope the meeting will help clear months of trade tensions between the world's two largest economies.
Trump, who began an Asian tour in Japan on Monday, told reporters aboard Air Force One that he was confident of reaching a deal with Xi."I think we're going to walk away with a deal," the US president said after attending a Southeast Asia summit in Malaysia, where he also reached preliminary agreements with Thailand, Cambodia, Vietnam and Malaysia.
For his part, Chinese Vice Minister of Commerce Li Chenggang confirmed that both sides had reached a “preliminary consensus,” paving the way for a possible final agreement during this week’s meeting.
Asian markets reacted enthusiastically. Japan's Nikkei 225 climbed 2.5 percent to close at 50,512.32, a new all-time high. The rally was fueled by the popularity of Prime Minister Sanae Takaichi, the first woman to hold the post, whose pro-market policies have boosted defense stocks, including a 9 percent jump in Kawasaki Heavy Industries.
In South Korea, the Kospi gained 2.6% to 4,042.83, also a record, with gains of more than 3% in Samsung Electronics and nearly 5% in SK hynix. In mainland China, the Shanghai Hong Kong index gained 1.2% and Hong Kong's Hang Seng added 1.1%.
“Renewed optimism about an easing of trade tensions between the US and China inevitably spilled over into Asian markets,” said Richard Hunter, director of markets at Interactive Investor.
In Europe, major indexes traded cautiously. Germany's DAX and Paris-based CAC 40 gained 0.1%, while Britain's FTSE 100 was unchanged, awaiting this week's monetary policy decisions from the Federal Reserve and the European Central Bank.
The Fed meets Wednesday and is expected to announce another quarter-point cut in its benchmark rate, following a weaker-than-expected U.S. inflation report on Friday. The figures fueled hopes that the central bank will continue its monetary easing cycle to bolster employment and consumption.
Oil prices fall
In energy markets, U.S. WTI crude fell 38 cents to $61.12 a barrel, while international benchmark Brent crude fell 37 cents to $64.83. Oil prices stabilized after rising nearly 8 percent last week as the United States and European Union tightened sanctions on Russian crude amid efforts to pressure Moscow to negotiate an end to the war in Ukraine.
The APEC Secretariat, however, warned in a report that annual growth in the Pacific region will slow to 3% this year from 3.6% last year, weighed down by trade restrictions and higher tariffs.
