(Bloomberg) — Asian stocks rose on optimism about US and China trade negotiations Monday, while positive jobs data in the world’s largest economy eased recession fears.
A regional stock gauge jumped 0.9% as technology shares advanced on Meta Platforms Inc.’s investment plans. Chinese shares listed in Hong Kong Kong advanced 1.1%, ahead of the talks in London. The index is poised to enter a bull market, trader parlance for a rise of 20% from a recent low. Yields on 10-year Treasuries dipped about 2 basis points to 4.49%, after surging Friday. The yen strengthened 0.4% against the dollar.
Easing trade tensions lifted a key gauge for emerging market equities 0.7%, with the index set for its highest close since February 2022.
Trade tensions appeared to recede between President Donald Trump and China’s Xi Jinping as an impasse on critical minerals was broken, paving the way for further trade talks. Adding to the optimism in the stock market was the surprise in labor data. While US job growth moderated in May and prior months were revised lower, Friday’s report narrowly exceeded forecasts.
“Keep the portfolio tilted toward risk” due to the dealmaking phase in Trump’s trade policy, Homin Lee, a senior macro strategist at Lombard Odier, said in a Bloomberg TV interview. There is scope of “bilateral deals before the July 9th deadline for the reciprocal tariffs,” he added.
Stock markets have rebounded following a tumultuous two-month period, with the S&P 500 gaining for the fifth week in seven. Asian and European equity benchmarks have risen seven times in the past eight weeks.
The main focus is on the trade negotiations. The US and Chinese negotiators are set to open their second round of trade talks Monday, the first since Trump and Xi finally broke a logjam. That’s offering a glimmer of hope that the world’s two largest economies can defuse tensions over Chinese dominance in rare-earth minerals.
Both sides had accused the other of reneging on a deal reached in May in Geneva, where they tried to start dialing back the trade war.
Ahead of the talks, China granted approval to some applications for the export of rare earths. Boeing Co. has also begun shipping commercial jets to China for the first time since early April, indicating a reopening of trade flows.
“Trade policy will remain the big macro uncertainty,” Kyle Rodda, a senior market analyst at Capital.com, wrote in a note Monday about the US-China negotiations. “Signs of further momentum in talks could give the markets fresh boost to kick-off the week.”
Later this week, attention will turn to the sale of government bonds in the US. The Treasury is set to sell $22 billion of 30-year bonds on Thursday, part of its regularly scheduled borrowings. This comes after global investor pushback against long-term government debt. Investors will also be watching US inflation print this week.
Separately, China’s consumer deflation extended into a fourth month, as price wars intensified while a spending boost during two national holidays failed to offset the drag from weak domestic demand.
On Friday, nonfarm payrolls increased 139,000 last month after a combined 95,000 in downward revisions to the prior two months. The unemployment rate held at 4.2%, while wage growth accelerated.
The payrolls figure helped alleviate concerns of a rapid deterioration in labor demand as companies contend with higher costs related to tariffs and prospects of slower economic activity.
In other trade news, a US trade team that’s currently in India for negotiations has extended its stay, according to people familiar with the matter. That’s a sign talks are progressing ahead of a July deadline.
Some of the main moves in markets:
Stocks
- S&P 500 futures fell 0.2% as of 12:57 p.m. Tokyo time
- Japan’s Topix rose 0.7%
- Hong Kong’s Hang Seng rose 1%
- The Shanghai Composite rose 0.2%
- Euro Stoxx 50 futures fell 0.1%
Currencies
- The Bloomberg Dollar Spot Index fell 0.1%
- The euro rose 0.1% to $1.1412
- The Japanese yen rose 0.2% to 144.50 per dollar
- The offshore yuan was little changed at 7.1867 per dollar
Cryptocurrencies
- Bitcoin fell 0.5% to $105,700.17
- Ether fell 1.4% to $2,497.58
Bonds
- The yield on 10-year Treasuries declined two basis points to 4.49%
- Japan’s 10-year yield advanced 2.5 basis points to 1.475%
Commodities
- West Texas Intermediate crude was little changed
- Spot gold was little changed
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Abhishek Vishnoi.
©2025 Bloomberg L.P.
