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Stocks rise on signs of eased Sino-US Trade tensions

The global stock market surged Friday, as possible trade talks between China and the U.S. lifted risk sentiment. This came after disappointing earnings from Apple and Amazon, two tech giants in the world of technology, fueled concerns about the potential impact of a trade war.

China's Commerce Ministry said Friday that the United States had repeatedly expressed their willingness to negotiate tariffs, and that Beijing was open for discussions. This could help ease trade tensions which have been roiling global markets.

Apple's share buyback program was cut and Apple warned that tariffs would add $900 million to costs in the current quarter.

Futures on the S&P 500 index rose by 0.8%, while Nasdaq futures were up 0.6%.

The Eurostoxx futures were up by 1.3%, indicating a positive start for European stock markets.

MSCI's broadest Asia-Pacific share index outside Japan reached its highest level since 25 March, recouping its losses after U.S. president Donald Trump launched a trade conflict with his tariffs early in April.

Japan's Nikkei rose over 1%, while Taiwan stocks soared by 2.4%. Hong Kong's Hang Seng rose 1.6% while mainland China was closed for a holiday.

Matt Simpson, senior analyst at City Index, said that China has struck a cautious note, demanding the U.S. "show sincerity" if it wants trade talks.

"While an olive branch was offered, it is hard to say that China has 'come stumbling' as Trump had hoped."

Investor sentiment was still evident in the comments, as markets grappled with President Donald Trump’s erratic policies on tariffs that have caused fears of an abrupt global economic downturn.

The U.S. economy contracted for the first three years during the first quarter of this year, and China's manufacturing activity declined at its fastest rate in 16 months as new tariffs began to bite.

Joseph Capurso of Commonwealth Bank of Australia's international and sustainable economy department said that the tariffs would have the greatest impact on the Australian economy when prices increase.

A recession is likely to occur if price increases cause consumers to reduce their spending, and businesses to shrink their workforces and reduce capital expenditure. "While a recession isn't our baseline, this year will be very close."

Many companies have cut or withdrawn their profit projections as a result of the U.S. Trade Policy rapidly changing.

While investors were disappointed by Apple's and Amazon's earnings, Microsoft and Meta Platforms had posted strong results earlier in the week, which raised hope that the tech sector could survive the tariff storm.

The Japanese yen fell to its lowest value since April 10, in the early Asian hours, but it was last slightly stronger at 145.26 US dollars.

The Bank of Japan, on Thursday, sharply reduced growth forecasts because of U.S. Tariffs. It also left interest rates unchanged. This suggests that the central bank may keep its policy on hold for some time.

Fred Neumann of HSBC's Asia chief economist said that the uncertainty surrounding tariffs could have indirect effects on Japan's growth.

The BOJ keeps the door open to further rate increases, but the current state of the door leaves it only slightly ajar.

The U.S. Dollar is now on track for a 0.4% weekly gain ahead of the important non-farm payrolls report later that day. The dollar index (which measures the U.S. money against six other currencies) was slightly lower last at 100.02.

A survey of economists revealed that nonfarm payrolls increased by at least 130,000 jobs in April, after increasing by 228,000 during March.

Katsunobu Kato, Japanese Finance Minister, said that Tokyo's trade negotiations with Washington can be aided by the huge U.S. Treasury stock of over $1 trillion.

The remarks came at a time when Japan's chief trade negotiator Ryosei Acazawa was meeting with U.S. Treasury Sec. Scott Bessent for a second round bilateral tariff talks in Washington.

Gold prices increased to $3,252.11 an ounce last Friday. However, it was still on track for its worst weekly performance since the end of February.

Prices of oil jumped as Trump threatened secondary sanctions against Iran and on the hints that trade tensions would ease, which if they did would support demand. Brent crude futures rose 0.66%, while U.S. West Texas Intermediate futures gained 0.7%. (Reporting and editing by Ankur Banerjee, Shri Navaratnam, and Kim Coghill).

(source: Reuters)