Asia stocks hit records on US–China trade thaw hopes
Asian equities opened the week with a surge after senior U.S. and Chinese officials sketched out a framework for a trade deal for Presidents Donald Trump and Xi Jinping to decide on later this week in South Korea.
The prospect of pausing steeper U.S. tariffs and China’s rare-earth export controls lifted regional benchmarks to fresh milestones: Japan’s Nikkei vaulted past 50,000, South Korea’s KOSPI cleared 4,000, and Taiwan shares climbed more than 2%. MSCI’s broad Asia-Pacific index added about 1.3% to a record peak, with Chinese blue chips higher and Hong Kong modestly firmer. U.S. equity futures rose (Nasdaq +1%), and European futures advanced roughly 0.5% as optimism bled into Western hours.
Currency markets reflected the risk-on tilt and the policy calendar ahead. The U.S. dollar edged up to ¥153.26, its strongest level since Oct. 10, while the euro and Swiss franc hit record highs against the yen. The Australian dollar – often treated as a China proxy – gained about 0.4% to $0.6541 on improving sentiment around trade. Traders widely expect the Federal Reserve to cut rates by 25 basis points on Wednesday after cooler-than-forecast September inflation, but they’re primed to parse Chair Jerome Powell’s guidance for December. Analysts at ANZ cautioned that with October and December cuts largely priced, any hint of caution from the Fed could underpin the dollar near term.
Hopes for de-escalation also filtered through the policy backdrop. U.S. Treasury Secretary Scott Bessent said weekend talks on the sidelines of the ASEAN summit removed the chance of 100% tariffs on Chinese imports from Nov. 1 and that China is expected to delay its rare-earth and magnet licensing regime by a year while it’s reconsidered. Markets will look to leader-level signals later this week to confirm whether the truce holds and whether China’s recent stimulus and reform messages translate into firmer activity data.
Commodities moved with the macro tide. Spot gold slipped about 0.8% to near $4,077/oz and December futures fell roughly 1.1% to around $4,091 as a firmer dollar and improving risk appetite weighed on the haven trade. Holdings of the SPDR Gold Trust dipped to 1,046.93 metric tons from 1,052.37 tons the prior day. Elsewhere, grains rose on trade-deal optimism, and industrial metals retained a bid amid the sentiment shift and ongoing supply stories.
The busiest stretch of U.S. earnings also lands this week, with Microsoft, Apple, Alphabet, Amazon and Meta due to report. Saxo’s Charu Chanana noted that guidance from Big Tech will be crucial to testing whether today’s optimism can turn into a durable conviction if the trade thaw is confirmed and central banks stick to the expected script.
Earlier this month, GNcrypto noted that on Oct. 17 President Trump tempered his rhetoric on China, acknowledging that the “high” tariffs he’d threatened weren’t sustainable and signaling plans to meet President Xi within weeks. The White House likewise hinted at de‑escalation, with economic adviser Kevin Hassett saying relations could normalize. That backdrop set the stage for today’s risk‑on reaction: this week’s draft framework for a trade deal reads like follow‑through on the softer tone we flagged earlier.
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