An Asia stocks rally has lifted world indices to record highs and the dollar has pared recent gains ahead of talks in London aimed at mending a trade rift between the United States and China.
MSCI’s broadest index of world shares climbed 0.2 per cent to a record high of 893.88 on Monday as European indices steadied and Asian markets closed higher.
The Japanese Nikkei closed almost one per cent higher, China’s blue-chip CSI300 Index climbed roughly 0.3 per cent, while the Shanghai Composite Index gained 0.4 per cent.
Top trade representatives from Washington and Beijing are due to meet for talks expected to focus on critical minerals, whose production is dominated by China.
“Trade policy will remain the big macro uncertainty,” said Kyle Rodda, a senior financial market analyst at Capital.com.
“Signs of further momentum in talks could give the markets fresh boost to kick off the week.”
US Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick and Trade Representative Jamieson Greer will represent Washington in talks with China, US President Donald Trump said in a social media post.
China’s foreign ministry said Vice Premier He Lifeng would be in Britain for the first meeting of the China-US economic and trade consultation mechanism.
Wall Street stocks had closed sharply higher on Friday after the closely watched monthly US jobs data eased concerns about damage to the world’s largest economy from Trump’s unpredictable tariff regime.
Sentiment was also weighed down by a standoff in Los Angeles that led to Trump calling in the California National Guard to quell demonstrations over his immigration policies.
The dollar fell 0.5 per cent against the yen to 144.09, trimming its 0.9 per cent jump on Friday.
The European single currency rose 0.2 per cent to $US1.1422 ($A1.7489).
Sterling traded at $US1.3568 ($A2.0775) , up almost 0.4 per cent.
US job growth slowed in May by less than had been forecast, data showed on Friday.
But dour economic readings from China added to evidence the trade war is taking a toll.
China’s export growth slowed to a three-month low in May, while factory-gate deflation deepened to its worst level in two years, separate reports showed on Monday.
Attention now turns to US inflation data on Wednesday that might adjust expectations for the timing of any rate cuts by the Federal Reserve.
The Fed is in a blackout period ahead of its June 18 policy decision.
“Markets have entered a tactical pause following a strong May, but beneath the surface, fragilities are building,” said Bruno Schneller, managing director at Erlen Capital Management, noting that the US CPI release was expected to show another rise, signaling that inflation remains sticky.
“While this may offer some near-term support for the US dollar, broader macro dynamics – notably fiscal expansion, rising structural deficits, and political unpredictability – are increasingly clouding the outlook for both rates and currencies,” he said.
Gold rose about 0.35 per cent to $US3,322 ($A5,087) per ounce after a 1.3 per cent fall on Friday.
US crude fell 16 cents to $US64.42 ($A98.64) a barrel following a 1.9 per cent surge late last week.
Australian Associated Press is the beating heart of Australian news. AAP is Australia’s only independent national newswire and has been delivering accurate, reliable and fast news content to the media industry, government and corporate sector for 85 years. We keep Australia informed.
