NEW YORK, United States (AFP) — Global stocks rallied Friday as US-China trade negotiations yielded a partial deal, while the British pound surged for a second straight session on signs that London and Brussels could still avert a no-deal Brexit.
The US-China agreement, announced in the closing minutes of Friday’s Wall Street session, halts new US tariffs that were scheduled to go into effect next week and includes a Chinese promise to ramp up purchases of American farm products.
Expectations of the deal boosted stocks all day, but major US indices retreated from their peaks in the final moments of the session, ending with gains of a bit more than one percent.
Analysts said the stock market’s pullback in the final moments likely reflected disappointment that the interim agreement did not go further, and left in place existing tariffs.
The announcement “sounds a little more limited than we were hoping for,” said FTN Financial’s Chris Low. “Nevertheless it is really good news.”
The pact, characterised by US officials as the first phase in negotiations, capped a roller-coaster week for stocks, with the market retreating early in the week on doubts about the talks, but reversing course midweek as the signs from both sides became more conciliatory.
Beijing and Washington have been at loggerheads for more than a year, with US President Donald Trump emphasizing trade relations with China as a central tenet of his “America First” agenda.
“There was a lot of friction between the United States and China, now it’s a love fest,” Trump said. “It’s beyond a trade deal.”
Business groups praised the agreement, but alluded to the unresolved status of the broader trade conflict.
“Although this is a step in the right direction, the uncertainty continues,” said David French, senior vice president at the National Retail Federation.