U.S. stock futures climbed Sunday evening following a significant breakthrough in the trade negotiations between the United States and China during the ASEAN summit over the weekend.
The deal framework reached by both sides helps avert the looming 100% additional tariff threat announced by President Donald Trump earlier this month, which was set to go into effect on November 1, 2025. It is also expected to delay China’s recent export controls on rare earths.
See Also: China’s Growth Engine Is Sputtering—And Trump’s Tariffs Are To Blame
According to U.S. Trade Representative Jamieson Greer, both sides have agreed to pause some of their recent punitive actions. He said the agreement includes “a path forward where we can have more access to rare earths from China, we can try to balance out our trade deficit with sales from the United States.”
China’s top negotiator, Li Chenggang, did not specify any aspects of the deal, but stated that both sides have reached a “preliminary consensus,” which will now undergo their respective internal approval processes.
The draft framework is set to be finalized by Trump and Chinese President Xi Jinping when they meet on Thursday in South Korea, according to a report by The Washington Post.
Markets Cheer Trade Deal Progress
The Nasdaq 100 Futures hit a new 52-week high on Sunday, rallying 0.84%, or 214 points, trading at 25,721.50. S&P 500 Futures are up 0.65%, or 44 points, trading at 6,871.50, which is less than 2% from the 7,000 point mark for the index. Finally, Dow Futures traded at 47,644.00, up 242 points, or 0.52%.
Japan’s benchmark Nikkei 225 index broke through the 50,000 point ceiling on Monday morning, after rallying 1.88%, or 924 points, currently trading at 50,224.12. The rally was led by manufacturing, heavy industries and other export-oriented stocks.
The U.S. Dollar Index (DXY) is down 0.14%, trading at 98.799 against a basket of other global currencies. Gold spot prices are down 0.70%, trading at $4,085.72 per ounce.
Investors will be closely watching stocks such as Welltower Inc. (NYSE:WELL), Cadence Design Systems Inc. (NASDAQ:CDNS) and NXP Semiconductors N.V. (NASDAQ:NXPI), among several others, which are set to release their quarterly earnings on Monday.
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