Monday was another positive day for global equities and US indices were up 1%, while EU benchmarks surged more than 1% during the US session. However, indices were down notably from overnight highs reached during the Asian session as some profit taking hit the markets in the afternoon.
Equities soared across the globe on Monday as Trump and Xi managed to calm the markets at their weekend meeting with a 90 days truce in their trade conflict. The White House said on Saturday that Trump had agreed to leave tariffs on US products at a 10 percent rate after January 1, as China agreed to buy a substantial number of products from the US.
However, if the new trade deal is not completed within the next 90 days, the tariffs may be upped to 25 percent as previously ’promised’. Traders took this news very positively and stocks shot higher, with US yields also pushing up.
Moreover, the US economic calendar brought some important data, such as the ISM survey from the manufacturing sector for the month of November and it jumped to 59.3, up from 57.7 in the previous month. Analysts had expected a slowdown to 57.5. However, the prices paid subindex crashed from 71.6 to 60.7, implying inflation pressures have deteriorated notably in November.
Gold also surged on Monday, while the dollar was sold most aggressively against the commodity-linked currencies.
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