European and Asian stock markets rose on Monday as optimism built around US-China trade and AI talks ahead of this week's Trump-Xi summit. Government bond yields fell across the region and oil prices dropped, while US futures pointed to a stronger Wall Street open.
European and Asian shares climb
Europe's pan-continental Stoxx 600 rose 0.65%, led by technology and travel stocks. The UK's FTSE 100 gained 0.36% to 10,697, while Germany's Dax added nearly 0.7%.
The region's tech sub-index increased 1.9%, with chip-linked stocks Soitec and Aixtron up 4.6% and 3.9% respectively. In Asia, Hong Kong's Hang Seng gained 0.88%, South Korea's Kospi jumped 2% and China's CSI 300 rose 0.6%. US stock futures pointed to a stronger open, suggesting the tech-heavy Nasdaq could rise almost 1%.
Trade talks fuel the optimism
The rally follows talks between US and Chinese economic officials in New York on Sunday, ahead of Thursday's summit between Donald Trump and Xi Jinping in Washington. US Treasury secretary Scott Bessent said the two countries discussed setting up a channel to communicate about AI issues, called the "US-China AI dialogue." According to Chinese state media: "candid, in-depth and constructive".
Analyst Stephen Innes of Quintex Intel said Bessent and Chinese vice premier He Lifeng had already laid the groundwork for the Trump-Xi meeting, but that markets are not waiting for a grand bargain — rather watching whether both sides can keep the next trade dispute contained.
Bond yields and oil retreat
Government borrowing costs fell as stock markets rose. The yield on the 10-year UK gilt fell nearly 7 basis points to 5.241%, Italy's 10-year yield dropped 9 basis points to 4.355%, and the German 10-year yield eased 5 basis points to 3.47%, wiping out Friday's increase.
Brent crude, the global oil benchmark, fell just over 2% to $101.8 a barrel, a drop of $2.01, on reports that more Saudi oil supply is moving through the Strait of Hormuz. The decline in oil added to hopes of lower inflation pressures, though Brent remains above $100 and well above pre-Iran war levels of around $72 a barrel.
Source: Business | The Guardian
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