Markets Overview
- ASX SPI 200 futures little changed at 8,216.00
- Dow Average up 0.6% to 41,368.45
- Aussie down 0.4% to 0.6400 per US$
- US 10-year yield rose 10.7bps to 4.3765%
- Australia 3-year bond yield fell 0.9 bps to 3.36%
- Australia 10-year bond yield fell 3.9 bps to 4.24%
- Gold spot down 1.7% to $3,306.25
- Brent futures up 3.4% to $63.18/bbl
Economic Events
- 11:00: (AU) Australia to Sell A$700 Million 2.75% 2029 Bonds
Asian stocks were poised to gain on Friday after President Donald Trump announced a trade deal with the UK and signaled tariffs on Chinese goods may fall if upcoming talks go well, boosting risk sentiment.
Equity futures for Japan and Australia climbed while those for US indexes were little changed Friday after the S&P 500 rose 0.6% and the Nasdaq 100 advanced 1% on Thursday. A gauge of US-listed Chinese stocks climbed 1% and Bitcoin jumped to above $100,000. Treasury yields surged as traders pared bets on interest-rate cuts, leaving the US 10-year yield 11 basis points higher on Thursday at around 4.38%. The Bloomberg Dollar Spot Index rose 0.6%.
Trump pitched his trade framework with the UK as a historic achievement, and the first step in his revolutionary effort to overhaul the global economy. As the US prepared for the start of talks with China — the biggest target of Trump’s tariff onslaught — the president said he believed negotiations could result in tangible progress.
“Tariffs are steering the boat again,” said Louis Navellier, chief investment officer at Navellier & Associates. “We are seeing a risk-on sentiment. The fear of missing out on favorable agreements being reached has limited the number of sellers.”
Trump also said that promising trade news paired with Republican efforts to pass legislation extending and expanding his signature tax cuts should be reason for investor optimism.
Treasury Secretary Scott Bessent and US Trade Representative Jamieson Greer are set to meet in Switzerland with Chinese Vice Premier He Lifeng on trade in the coming days. Trump said that if talks went well, he could consider lowering the 145% tariff he has imposed on many Chinese goods.
While the real game-changer would be progress with China, that’s where it gets murky, according Fawad Razaqzada at City Index and Forex.com.
“The weekend meeting between the US and China feels more like a diplomatic icebreaker than a breakthrough moment,” Razaqzada noted. “We could be in for a long, drawn-out negotiation season, which may limit the upside potential for risk assets.”
Key data set for release in Asia included April trade data in China. Elsewhere, India said it “neutralized” Pakistani drone and missile attacks targeting several military sites on Thursday night, marking an escalation in hostilities between the two nuclear-armed neighbors.
In commodities, gold rebounded early Friday after falling in its two previous sessions. Oil climbed, reflecting optimism about the potential for further US trade deals.
