The financial markets were satisfied with the indication of “substantial progress” achieved by China and the United States in the negotiations on tariffs which took place over the weekend in Geneva, although without details, to push upwards and increase risk appetite. Also contributing to the climate is the albeit fragile ceasefire between India and Pakistan, while Ukrainian President Volodymyr Zelensky he said he was ready to meet Vladimir Putin in Türkiye on Thursday for talks. S&P 500 futures up 1,4% and Nasdaq futures up nearly 2%. US dollar futures European stocks suggest an opening up nearly 1%. The dollar is also taking a breather against most of its peers, while gold is falling and Treasuries have also suffered heavy selling due to the easing of hopes for a rate cut. Oil is rising on the other hand, on hopes of an improving economy thanks to hypotheses of a thaw.
China-US: Joint statement expected today
“As we say in China, if the food is delicious, the timing doesn't matter,” Chinese Vice Minister of Commerce Li Chenggang told reporters in Geneva. That's how the long-awaited weekend meeting between USA and China tariffs was discussed at its conclusion yesterday, without providing details, while Chinese Vice Premier He Lifeng called it “an important first step” toward resolving differences. Investors will be looking for details of the U.S.-China talks when U.S. Treasury Secretary Scott Bessent holds a press briefing today at 9:00 am Geneva time. Speaking after the talks, Trade Representative Jamieson Greer told reporters that “the differences were not as big as you might think.” Chinese officials reiterated the message at a separate briefing Sunday, saying the talks had produced “solid sustainable development” for Sino-U.S. relations.
The retaliation has raised US tariffs on Chinese imports to 145%, while China has imposed a 125% tariff on US products. A joint statement is expected later today and the markets, while not expecting a deal, are at least positive that the talks were not bellicose.
Asia in Good Mood. US-Japan Uncertain on Tariffs
As the trading week began in Asia, Chinese stocks edged higher and the yuan strengthened. The benchmark CSI 300 index for onshore shares rose as much as 1,2%, close to recovering losses suffered after U.S. President Donald Trump announced tariffs on Liberation Day on April 2.
In Asia Pacific, the Hang Seng Index Hong Kong gains 0,9% and reaches its eighth consecutive session of growth. CSI 300 of the stock markets Shanghai and Shenzhen +0,6%. Taiex of Taipei +0,7%. Of note in Hong Kong is Catl, the Chinese giant in electric car batteries, which plans to raise about $4 billion by listing on the country's stock exchange on May 20. Catl, a supplier to most major car brands (Tesla, Mercedes, Chinese manufacturers), will offer about 117,9 million shares, at a maximum price of 263 Hong Kong dollars each (33,8 US dollars), for a total expected amount of 31,01 billion Hong Kong dollars.
The fragile truce between India and Pakistan is pushing up the Mumbai stock market with the BSE Sensex up 2,9% and Pakistani stocks up over 8,5%. Indian bond and currency markets are closed on Monday for a holiday, as the offshore rupee appreciates.
La Tokyo stock exchange is at parity and the yen weakens against the dollar at 145,8. There does not appear to be full agreement between the United States and Japan on the tariff review. Prime Minister Shigeru Ishiba told a parliamentary hearing that the government will not agree to sign partial and provisional trade agreements; the agreement, if reached, must also cover the auto industry. At the same parliamentary session, top trade negotiator Ryosei Akazawa said that Japan will continue to seek a reprieve from all U.S. tariff measures, hoping that some kind of agreement can be reached next month. Public broadcaster NHK reported that so far Japan has proposed increasing investment in the U.S. auto sector, as well as strengthening cooperation in shipbuilding.
Optimism Drives Away From Gold, Pushes Oil Up
The general increase in risk appetite has hurt their, which has been on a positive trend in recent weeks as investors sought safety in the physical metal. Gold fell 1,5% to $3.273 an ounce, below its all-time high of $3.500 in April.
The prices of Petroleum took the opposite tack, hoping that progress in trade talks could reduce the risk of a major economic crisis, although OPEC+ plans to increase supply remain a headwind. Brent crude rose 39 cents to $64,30 a barrel, while U.S. crude rose 41 cents to $61,43 a barrel.
European stocks seen opening higher. Eyes on Unicredit and Iveco
European stocks should open higher, as suggested by the EuroStoxx 50 future at +0,8%
Leonardo. The non-binding offer that Leonardo has presented together with the German Rheinmetall for the military division of Iveco is worth just under 1,5 billion euros. This was reported Il Fatto Quotidiano on Sunday, citing authoritative sources close to the dossier. According to the newspaper, the Franco-German group KNDS has also presented an offer, exceeding 1,5 billion euros, and there is also interest from some funds.
Recordati. Donald Trump will sign an executive order that will reduce the prices of prescription drugs and pharmaceuticals in the United States by 30-80%.
Stellantis The search for a new CEO is about to conclude and Italian Antonio Filosa is the main candidate, Bloomberg news writes
Unicredit closes the quarter with better-than-expected results thanks to higher fees, solid trading results and a still very low Cost of Risk. At the balance sheet level, the CET1 ratio is above expectations. “We are positioned for a range of inorganic possibilities in our markets but will only pursue those that enhance our strong and resilient standalone investment case,” said UniCredit CEO Andrea Orcel, commenting on the results.
UniCredit also raised its guidance for 2025 (with a possible upside): net profit is estimated at more than €9,3 billion with a RoTE higher than 17%. A higher dividend distribution is also expected than in 2024 thanks to the higher growth in net profit, a note explains. Net revenues for 2025 are expected at around €23,5 billion, better than initially anticipated thanks to a stronger first quarter and a lower cost of risk. UniCredit confirms its ambition for a net profit of around €10 billion in 2027. Some members of the bank's board are seeking greater clarity on CEO Andrea Orcel's M&A strategy, asking him to explain which path he intends to follow, two sources told Reuters. Germany's new Finance Minister Lars Klingbeil has expressed opposition to UniCredit's possible takeover of Commerzbank.
"Brussels has competences in banking and competition matters. Up to this point, the Italian state has decided on national security, not Europe". This was stated by the Minister of Economy Giancarlo Giorgetti, questioned on Saturday about the possibility that the European Commission might contest the 'golden power' conditions imposed on the Unicredit-Banco BPM operation, according to what was reported byHandle.
Banca Mediolanum. HSBC raises target price.
