In European Equity Markets indices rallied on Monday, after President Donald Trump and President Xi Jinping negotiated a temporary truce to their trade conflict over the weekend. The pan-European Stoxx 600 close up 1.6 percent. Europe’s basic resources stocks, with their heavy exposure to China, jumped almost 5 percent as investors reacted to a cease-fire on tariffs between Washington and Beijing. Antofagsta, Glencoreand Anglo American were all trading more than 6 percent higher on the news. Meanwhile autos stocks also rose over 4 percent.
In Currency Markets sterling fell on Monday to its lowest level since the end of October as growing concerns about British parliamentary approval for a proposed Brexit deal prompted investors to sell the currency. Against the dollar, the pound fell to its lowest since October at $1.2697, down nearly 0.7 percent from the day’s highs. Against the euro, the pound weakened by 0.4 percent to 89.23 pence. British Prime Minister Theresa May said she would still be in her job in two weeks’ time, playing down speculation that she might resign if the Brexit deal is not approved.
In Commodities Markets oil prices jumped by more than 3 percent on Monday after the United States and China agreed to a 90-day truce in a trade dispute and Canada’s Alberta province ordered a production cut, while exporter group OPEC looked set to reduce supply. Brent crude futures rose $1.86, or 3.1 percent, to $61.32 a barrel. U.S. West Texas Intermediate (WTI) crude rose $1.68 to $52.61 a barrel, a 3.3 percent gain. Both benchmarks jumped by more than 5 percent earlier in the session.
In US Equity Markets stocks rose on Monday, boosted by gains in trade-sensitive industrial and technology stocks after the United States and China agreed upon a temporary trade detente. The Philadelphia Semiconductor index rose 2.8 percent, its highest in over a month, driven by strong gains in the shares of U.S. chip-makers, which have the highest revenue exposure to China. Advanced Micro Devices Inc was up 9.2 percent. The S&P and Nasdaq were up more than a percent and rose to their highest in over three weeks.
In Bond Markets U.S. Treasury yields rose on Monday after a deal between the U.S. and China to hold off on new tariffs boosted risk appetite and reduced demand for safe haven U.S. debt. Benchmark 10-year notes fell 5/32 in price to yield 3.030 percent, up from 3.013 percent at Friday’s close. The yields dipped as low as 2.988 percent on Friday, the lowest since Sept. 18.