As Trump-Xi trade talks near, investors turn to history

Investors are heading into this week's trade talks between the U.S. and Chinese leaders with a sense of deja vu, excited by the proclamations of a truce and apprehensive the real deal may offer far less to celebrate.

- Reuters

(Reuters)

Stock markets across the world jumped on Monday after U.S. officials said negotiators from both sides had hashed out a framework for agreements for lower US tariffs on Chinese imports and Chinese concessions on rare earth export curbs.

As expectations build for US President Donald Trump to sign that deal with Chinese President Xi Jinping on Thursday and for some respite in the long mercurial relationship between the world's top two economies, the S&P 500 index rose 18 to hit a record high.

Stock markets in South Korea, Taiwan and Japan, too, notched new highs, while traditional havens such as gold fell in a sign investors were prepared to take more risky bets. It's a pattern markets have followed through Trump's first and now second presidencies, such as during the 2019 trade war with China and after his “Liberation Day” global tariff blitz this year, positioning for Trump to eventually back down after going on the offensive against trade partners.