Market Summary
Stocks Rise Ahead of Trump-Xi Summit: Stocks advanced as encouraging US-China talks and falling oil prices lifted sentiment ahead of Thursday’s Trump-Xi summit. The MSCI Asia Pacific Index rose 0.8%, led by technology shares, putting the MSCI All Country World Index on course for a third consecutive gain, its longest winning streak since late August. US and European futures also pointed to a firmer open.
US-China Talks Take Centre Stage: US and Chinese officials agreed to establish a dialogue on AI goals and risks, while work continues on easing trade barriers affecting $30 billion of products from each side, including US energy and agricultural exports. Investors will be watching to see whether the summit delivers concrete progress or an extension of the existing trade truce. With very little economic data due, the talks take centre stage following last week’s first Fed rate increase since 2023 and a split Bank of Japan decision to raise borrowing costs.
Oil Extends Decline as Supply Flows Improve: Brent crude fell for a fourth consecutive session to $102.51 a barrel as traders tracked diplomatic efforts to end the US-Iran war and improving flows through the Strait of Hormuz. A US commander said oil and LNG shipments through the waterway had reached their highest level in six months over the past fortnight. Lower energy prices eased inflation concerns and supported Treasury futures, although trading was quieter due to the holiday in Japan. German bond futures also gained after Chancellor Merz pledged to remain in office despite his party’s setback in a state election. Later this morning, Fed official Goolsbee is due to speak at an event.
Key Market Moves Today
- S&P 500 Futures: +0.45% (7,747)
- Brent Crude: -1.98% ($101.81)
- Spot Gold: -0.61% ($4,351)
- Bitcoin: +0.6% ($81,540)
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