Global Stocks Rise on Trump’s Tariff Reluctance: Markets Wrap

(Bloomberg) — Global stocks rose for a ninth day, on track for a record high, boosted by comments from US President Donald Trump hinting at a potentially softer approach toward tariffs on China. The yen strengthened after the Bank of Japan raised interest rates. 

Chinese equities jumped and the yuan extended gains, after Trump said in an interview with Fox News that he would rather not have to use tariffs against the world’s second-largest economy. A gauge of emerging-markets currencies is poised for its best week since July 2023 on the back of a weaker dollar.

“Price action will be volatile because those negotiations may not lead to success,” said Alvin Tan, an FX strategist at Royal Bank of Canada in Singapore. “But the situation is definitely turning away from the worst-case fears regarding US tariffs. It’s still very early days, and Trump is mercurial, but it does increasingly appear that US trade policy on China is on the negotiating table.” 

Futures for the S&P 500 were steady, while Europe’s rose. The nine-day advancing streak by MSCI’s all-country share index would be the longest in more than a year. The 10-year Treasury yield slipped. 

Assets often seen as proxies for China also reacted, with the Australian dollar gaining 0.7%. But some recommended caution in interpreting the US President’s comments.

Trump’s remarks “could be a sign he’s willing to negotiate with Beijing before resorting to massive levies on imports from China,” said Chang Shu, Chief Asia Economist for Bloomberg Economics, in a note. “That said, it’s difficult to see Trump backing down from his tariff threats.”

In Japan, the yen strengthened against the greenback, after the Bank of Japan raised interest rates for the first time since July. It briefly broke through the key 155 level versus the dollar during Governor Kazuo Ueda’s press conference before pulling back as traders parsed his comments. 

The central bank signaled that it sees a faster pace of inflation in the coming years compared with its previous forecast. The BOJ also said if its outlook is realized, it will continue to raise the policy rate. The country’s two-year and five-year government bond yields rose to their highest levels since 2008. The Topix index of stocks fluctuated.

“A narrowing of short-term rate differentials should bump up the yen in the short-term, even if today’s hike is largely anticipated,” said Wei Liang Chang, a strategist with DBS Bank Ltd. “However, the BOJ’s slow pace of rate hikes, on top of likely trade frictions from Trump, mean that USD/JPY could recover toward 160 with a strong dollar.”

Back in the US, there’s some optimism Trump’s administration may be able to thread the needle in introducing measures that will boost growth and stocks, even while keeping a lid on prices pressures, which should allow the Federal Reserve to continue monetary easing this year.

In the corporate world, shares of Mitsubishi Motors Corp. fell after Japanese media reported that it won’t be a part of Honda Motor Co. and Nissan Motor Co.’s plans to combine their companies under a holding company.

Also, Italian lender Banca Monte dei Paschi di Siena SpA is exploring a potential deal for Mediobanca SpA, people with knowledge of the matter said.

Key events this week:

• Eurozone HCOB Manufacturing & Services PMI, Friday
• US University of Michigan consumer sentiment, existing home sales, S&P Global Manufacturing & Services PMI, Friday

Some of the main moves in markets:

Stocks

• S&P 500 futures were little changed as of 6:49 a.m. London time
• Nasdaq 100 futures fell 0.2%
• Futures on the Dow Jones Industrial Average were little changed
• The MSCI Asia Pacific Index rose 0.9%
• The MSCI Emerging Markets Index rose 0.9%
• S&P 500 futures were little changed
• S&P/ASX 200 futures rose 0.4%
• Hong Kong’s Hang Seng rose 1.9%
• The Shanghai Composite rose 0.7%
• Euro Stoxx 50 futures rose 0.5%

Currencies

• The Bloomberg Dollar Spot Index fell 0.4%
• The euro rose 0.5% to $1.0463
• The Japanese yen rose 0.4% to 155.41 per dollar
• The offshore yuan rose 0.5% to 7.2478 per dollar
• The British pound rose 0.5% to $1.2410

Cryptocurrencies

• Bitcoin rose 1.8% to $104,976.61
• Ether rose 4.5% to $3,394.28

Bonds

• The yield on 10-year Treasuries declined two basis points to 4.62%
• Germany’s 10-year yield advanced two basis points to 2.55%
• Britain’s 10-year yield was little changed at 4.64%
• Japan’s 10-year yield advanced two basis points to 1.225%
• Australia’s 10-year yield was little changed at 4.48%

Commodities

• Spot gold rose 0.7% to $2,773.67 an ounce
• West Texas Intermediate crude was little changed

This story was produced with the assistance of Bloomberg Automation.

–With assistance from Jason Scott, Iris Ouyang and Mia Glass.

©2025 Bloomberg L.P.