Global stock markets rallied on Friday as optimism over potential trade talks between the United States and China helped lift investor sentiment, counterbalancing concerns sparked by disappointing earnings reports from major tech firms. China’s commerce ministry signaled that the U.S. had repeatedly expressed willingness to negotiate on tariffs, and reiterated that Beijing remains open to dialogue. These developments offered relief to markets shaken by prolonged trade tensions.
The positive shift in tone helped U.S. stock futures bounce back from earlier declines. S&P 500 futures rose by 0.8%, while Nasdaq futures climbed 0.6%. In Europe, the Eurostoxx 50 futures advanced 1.3%, suggesting a strong open. Meanwhile, MSCI’s broad Asia-Pacific share index outside Japan surged to its highest level since late March, erasing the losses incurred since the start of the tariff standoff. Japan’s Nikkei gained over 1%, Taiwan’s stock market rose 2.4%, and Hong Kong’s Hang Seng jumped 1.6%. Mainland China markets remained closed due to a public holiday.
Investors welcomed the more conciliatory rhetoric from China, although analysts noted that Beijing’s cautious language indicated it still expects the U.S. to demonstrate sincerity. While this might not fulfill expectations set by U.S. leadership, markets responded positively to the renewed chance for dialogue. Nevertheless, concerns linger as markets continue to navigate unpredictable U.S. tariff policies, which have stoked fears of a global economic slowdown.
Economic data highlighted these concerns. The U.S. economy contracted for the first time in three years in the first quarter, while China’s factory output in April saw its sharpest decline in over a year. Analysts warned that rising consumer prices driven by tariffs could trigger reduced spending and investment, potentially pushing some economies toward recession.
Earnings reports have reflected these pressures. While strong results from Microsoft and Meta Platforms earlier in the week buoyed sentiment, lackluster performances from Apple and Amazon dampened investor confidence. Apple trimmed its share buyback and warned of $900 million in additional costs from tariffs this quarter.
In currency markets, the Japanese yen weakened initially but later firmed slightly to 145.26 per U.S. dollar. The dollar index hovered at 100.02, poised for a 0.4% weekly gain ahead of key U.S. jobs data, with economists projecting a slowdown in job growth.
In commodities, gold prices rose to $3,252.11 per ounce, though the metal was on track for its weakest weekly performance since February. Oil prices rose as threats of new sanctions on Iran and easing trade tensions raised hopes for improved demand.
READ MORE: