➤ US joins China in showing goodwill gestures.
➤ Euro reverses losses against dollar.
➤ Lira jumps as Turkish central bank delivers less aggressive rate cut.
After China's decision to exclude certain U.S. imports from additional levies, President Donald Trump said he will delay planned tariff increases on $250 billion of Chinese imports by two weeks as a goodwill gesture.
China was reportedly considering resuming U.S. agricultural imports in another sign of concession before the planned face-to-face trade talks in Washington next month.
The moves from both camps are "a step in the right direction," said Lee Hardman, currency analyst at MUFG Bank. "While a comprehensive U.S.-China trade deal remains unlikely, a mini-deal is more achievable to dampen some of the heightened trade policy uncertainty."
The S&P 500 and Nasdaq 100 advanced 0.4% and 0.8%, respectively, around 9:35 a.m. ET. In Europe, the FTSE 100 was little changed while France's CAC 40 and Germany's DAX were up 0.6% and 0.5%.
In Asia, the Shanghai SE Composite and Japan's Nikkei 225 were up 0.8% each, while Hong Kong's Hang Seng lost 0.3%. Hong Kong Exchanges & Clearing Ltd. tumbled 3.5% as analysts flagged considerable political risks facing the company's surprise bid for the London Stock Exchange Group PLC.
In bond markets, European bonds' rally seen as of 9:09 a.m. ET lost momentum to some extent, as the ECB lowered its rate on the deposit facility and announced that it will restart bond purchases, at a monthly pace of €20 billion.
The yield on the 10-year German Bunds dropped 1 basis point and 10-year yields on French and Belgian bonds lost nearly 2 basis points each around 9:35 a.m. ET. The yield on the Netherlands' government bonds were flat.
Spanish bond yields shed nearly 9 basis points.
U.S. bonds rose as yields on 10-year Treasurys fell 3 basis points to 1.716%.
In currencies, the euro reversed its losses against the dollar, as markets closely followed ECB President Mario Draghi's speech. Industrial production in the eurozone unexpectedly declined 0.4% month over month in July after a 1.4% drop in June.
The Turkish lira gained 0.9% as the Türkiye Cumhuriyet Merkez Bankası AS slashed its policy rate by 325 basis points amid ongoing economic recovery and disinflation, a move that did not seem as aggressive as markets had predicted.
Sterling was up 0.1%. Belfast's High Court reportedly dismissed a case claiming that a no-deal Brexit would violate Northern Ireland's 1998 peace accord. Previously, the U.K. government published its planning document for a worst-case scenario in case of a no-deal Brexit.
The Japanese yen gained 0.1%, while the Dollar Index rose 0.1% as U.S. core annual inflation accelerated ahead of the Fed meeting next week.
Brent crude oil lost 2.61% to $59.25 per barrel on the ICE Futures Exchange. Oil prices fell sharply yesterday on the back of a report that Trump had discussed easing sanctions on Iran.
Gold advanced 1.3%.
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The day ahead:
10:30 a.m. ET — U.S. Energy Information Administration natural gas report
2 p.m. ET — U.S. Treasury budget
4:30 P.M. ET — U.S. Fed balance sheet
4:30 P.M. ET — U.S. money supply
