World stocks rally as Trump delays China tariffs

LONDON: Global stocks rebounded Monday after US President Donald Trump said he would delay a hike in tariffs on Chinese goods, citing "substantial progress" in trade talks and fuelling hopes of an end to the long-running stand-off.

Shanghai spearheaded gains across Asia with a surge of more than five percent, while Hong Kong and Tokyo each rose 0.5 percent in value.

European equities also fizzed higher with London adding 0.2 percent by midday, while both Frankfurt and Paris each gained 0.4 percent.

Optimism over the negotiations had already provided support to global equities, spurring a rally in January and February, but the president's comments gave extra ammunition to investors to ramp up buying.

"Global markets are on the rise ... as markets celebrate the news of an indefinite delay to the deadline beyond which US will ramp up tariffs on Chinese imports," said IG analyst Joshua Mahony.

"Donald Trump's decision to push back the March 1 deadline comes amid significant progress on a number of crucial fronts, including intellectual property protection, technology transfer, agriculture, services, and currency.

"The fact that the US are seeking to address the value of the Chinese currency is of particular interest to markets."

The news fired currency markets with the yuan extending gains to a seven-month high, while other high-yielding, riskier units were also up against the dollar.

Trump said on Twitter that the US "has made substantial progress in our trade talks with China on important structural issues including intellectual property protection, technology transfer, agriculture, services, currency, and many other issues".

He added: "As a result of these very productive talks, I will be delaying the US increase in tariffs now scheduled for March 1."

Trump also said he planned to hold a summit with his Chinese counterpart Xi Jinping at his Mar-a-Lago estate in Florida to sign a deal.

China's Xinhua news agency added that the two sides had "made substantial progress on specific issues" including on transfer of technology, intellectual property and agriculture.

The gains in Asia followed another positive lead from Wall Street, where the Dow enjoyed its ninth straight weekly gain -- the longest streak since May 1995.

- Post-Brexit derivatives deal -

Separately, Britain and the United States agreed Monday to maintain how multi-trillion dollar financial transactions are carried out between the two countries aimed at avoiding markets uncertainty following Brexit.

"Market participants can be assured of the continuity of derivatives trading and clearing activities between the UK and US, after the UK's withdrawal from the EU," the pair said in a joint statement.

"UK and US authorities are taking measures to ensure the UK's withdrawal from the EU, in whatever form it takes, will not create regulatory uncertainty," it added.

The UK and US carry out trades of derivatives -- or securities whose value is based on an asset such as currencies, stocks and commodities -- worth a combined $2.4 trillion daily, Bank of England governor Mark Carney told a press conference in London.

- Key figures around 1200 GMT -

London - FTSE 100: UP 0.2 percent at 7,190.48 points

Frankfurt - DAX 30: UP 0.4 percent at 11,503.58

Paris - CAC 40: UP 0.4 percent at 5,237.77

EURO STOXX 50: UP 0.4 percent at 3,282.99

Shanghai - Composite: UP 5.6 percent at 2,961.28 (close)

Tokyo - Nikkei 225: UP 0.5 percent at 21,528.23 (close)

Hong Kong - Hang Seng: UP 0.5 percent at 28,959.30 (close)

New York - Dow: UP 0.7 percent at 26,031.81 (close)

Euro/dollar: UP at $1.1364 from $1.1335 at 2200 GMT

Pound/dollar: UP at $1.3073 from $1.3053

Euro/pound: UP at 86.91 pence from 86.81 pence

Dollar/yen: UP at 110.75 yen from 110.69 yen

Oil - Brent Crude: DOWN seven cents at $67.05 per barrel

Oil - West Texas Intermediate: UP 13 cents at $57.39