US-China Agreement Sends Stock Markets Soaring
In a significant development, the US and China have reached a tentative agreement to roll back tariffs, sending stock markets surging. The news has been hailed as a “pleasant surprise” by investors, who had been hoping for a resolution to the ongoing trade tensions between the two nations.
According to reports from the BBC, Hong Kong’s benchmark Hang Seng Index jumped 3% following the announcement, while European stock markets also saw significant gains. Early indications suggest that the main US stock markets will open up by more than 2% [1]. The rapid escalation of trade tensions between the US and China has been a major concern for investors, with many fearing that a global trade war could have far-reaching consequences for the global economy.
The agreement, which was announced on May 12, 2025, marks a significant breakthrough in the ongoing trade talks between the US and China. As noted by Russ Mould, investment director at AJ Bell, “Some people thought the best-case outcome from the weekend’s discussions would be an agreement to simply keep talks going.” However, the actual agreement reached has exceeded expectations, with tariffs being rolled back by a large amount. Mr. Mould told the BBC that the agreement has been welcomed “with open arms” by investors, and is “a major breakthrough” as far as they are concerned [1].
The impact of the agreement has been felt across various markets, with oil prices jumping on hopes that global growth will be boosted by the tariff agreement. The price of benchmark Brent crude rose more than 3% to $64.14 a barrel, according to reports [1]. On the other hand, the price of gold fell 3% to $3,224.34 an ounce, as investors moved away from safe-haven assets.
The disruption caused by President Trump’s tariffs has helped the gold price to rise in recent weeks, as it is seen as a safer asset in times of uncertainty. However, with the agreement in place, investors are now more optimistic about the prospects for global growth, and are correspondingly less interested in safe-haven assets.
As noted by the BBC, the agreement marks a significant shift in the ongoing trade tensions between the US and China. The two nations have been locked in a trade dispute for several months, with the US imposing tariffs on Chinese goods and China retaliating with tariffs of its own. The agreement will come as a relief to investors, who have been worried about the impact of the trade tensions on the global economy.
In conclusion, the US-China agreement has sent stock markets soaring, with investors hailing it as a “pleasant surprise”. The agreement marks a significant breakthrough in the ongoing trade talks between the two nations, and has been welcomed by investors. As the global economy continues to navigate the complexities of international trade, this development will be closely watched by investors and policymakers alike.
References:
[1] BBC. (2025, May 12). US-China agreement is a ‘pleasant surprise’ for markets. Retrieved from
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