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Trade talks lift Asia-Pacific stocks, US markets steady

Asia-Pacific markets traded mostly higher on Tuesday as US-China trade discussions in London entered their second day, boosting investor sentiment. Meanwhile, US markets started the week flat, with investors awaiting inflation data and further developments from trade talks. Gold prices eased slightly, trading around USD 3310 per ounce early in the week, while bitcoin surged, trading near all-time highs at USD 109,300.

  • Date
  • Auteur Shane Strowmatt, LGT
  • Temps de lecture 5 minutes

US China trade negotiations
© Shutterstock

Asia-Pacific markets mostly advanced on Tuesday as investors monitored the second day of trade discussions between the US and China in London, hoping for a positive outcome. Japan’s Nikkei 225 was trading 0.4% higher one day after revised data showed Japan's economy contracted by an annualised 0.2% in the first quarter, an improvement from the initial estimate of a 0.7% decline. South Korea’s Kospi rose 0.2% on Monday, supported by optimism over potential fiscal policies under the country’s new leadership. Australia’s S&P/ASX 200 was trading 0.7% higher. However, Hong Kong’s Hang Seng Index slipped 0.3%, and mainland China’s CSI 300 fell 0.6%. Despite positive sentiment coming out of the London talks, weak macroeconomic data dragged down sentiment in the world’s second-largest economy. On Monday, data released showed China's consumer prices fell 0.1% year-on-year in May, marking the fourth consecutive month of decline as demand remains subdued despite government stimulus efforts.

Inflation and labour market data in focus

In addition to the trade negotiations between the US and China, markets turn their attention this week to a series of key inflation and labour market updates from major economies. The United States publishes Consumer Price Index figures on Wednesday and Producer Price Index data on Thursday, offering insights into inflation trends and their implications for Federal Reserve policy. In Europe, Germany and France release harmonised Consumer Price Indices on Friday, alongside euro-area industrial production data. Additionally, the University of Michigan Consumer Sentiment Index on Friday will provide a snapshot of US consumer confidence and inflation expectations.

US stocks start the new week steady

US stock markets closed with minimal movement on Monday, as investors awaited further developments from the US-China trade negotiations. The Dow Jones Industrial ended flat at 42,761.76 points, while the S&P 500 and Nasdaq 100 posted slight gains of 0.1% and 0.2%, respectively. Tesla shares rose 4.6%, recovering from earlier losses linked to CEO Elon Musk's dispute with US President Donald Trump. Wrapping up last week’s macroeconomic data, US job growth decelerated in May, with nonfarm payrolls rising by 139,000, compared to a downwardly revised 147,000 in April. The Labor Department also revised March and April data, reducing job gains by 95,000. While the unemployment rate remained steady at 4.2%.

Euro area reports modest GDP growth

Eurostat reported on Friday that seasonally adjusted gross domestic product (GDP) in the euro area increased by 0.6% in the first quarter of 2025, doubling the 0.3% growth seen in the previous quarter. Year-on-year, GDP rose by 1.5%, up from 1.2% in the fourth quarter of 2024. European markets are expected to follow Asian markets higher at Tuesday’s open.

Switzerland imposes capital hike on UBS

The Swiss government announced on Friday that UBS will face stricter capital requirements following its 2023 acquisition of Credit Suisse, necessitating an additional USD 26 billion in core capital over the next six to eight years. The measures, aimed at stabilising Switzerland's financial system, include fully capitalising UBS's foreign units and reducing reliance on Additional Tier 1 bonds. In separate Swiss news, the United States Treasury Department placed Switzerland on its watch list for currency and economic practices, alongside eight other countries, in a report issued late last week. Switzerland, along with Ireland, was newly added to the list due to its significant trade surplus with the US last year.

Corporate and economic calendar

Corporate news in focus: Annual general meeting at Sonova.

Economic data in focus: UK unemployment rate (08:00).

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Editor: Alessandro Fezzi
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