Global stocks rally and the yuan jumps after Biden says he's weighing cutting tariffs on China
- Global stocks rose Monday after US President Joe Biden said he is considering cutting tariffs on China.
- His comments also boosted the yuan, China's currency, which has struggled this year as the economy has slowed.
Global stocks rose on Monday and the yuan surged after US President Joe Biden said he's considering cutting tariffs on China.
S&P 500 futures were up 0.46% as of 5.27 a.m. ET, suggesting stocks will open higher when trading begins. Dow Jones futures were up 0.36% and Nasdaq 100 futures were 0.43% higher.
Europe's continent-wide Stoxx 600 was up 0.31%. China's CSI 300 closed 0.58% lower, paring earlier steeper losses, while Tokyo's Nikkei 225 rose 0.98%.
Biden said he was considering lowering tariffs on China during a news conference in Japan. The tariffs were put in place by President Donald Trump in 2018 and 2019 as part of his effort to reduce the US trade deficit.
"I am considering it. We did not impose any of those tariffs. They were imposed by the last administration and they're under consideration," Biden said when asked about cutting the tariffs, according to Reuters.
Naeem Aslam, market analyst at trading platform AvaTrade, said: "US and European futures are trading positive today as traders are feeling a bit optimistic about the news that the Biden Administration could be reversing some of the tariffs."
Biden's comments also boosted the yuan, China's currency, which has fallen sharply this year as the country's economy has slowed under the zero-COVID policy.
The offshore yuan rose as much as 0.7% and was last up 0.53% to 6.664 per dollar.
The US dollar index fell 0.98% to 102.14 as investors sold the safe-haven currency as their fears about the global economy dimmed somewhat.
"This morning, the Australian and New Zealand dollars are leading the rally against the dollar on the back of risk-on sentiment and yet another strong day for the Chinese yuan," said Francesco Pesole, FX strategist at Dutch bank ING.
"Reports that President Biden is considering lifting some of the tariffs on China are also helping."
US government bonds also dipped, pushing up yields, which move inversely to prices. The yield on the key 10-year US Treasury note rose 3 basis points to 2.822%.
Investors have dumped global stocks at a rapid pace this year, as central banks have raised interest rates to tame inflation, Russia's invasion of Ukraine has dragged on, and Chinese growth has slowed.
The S&P 500 is flirting with a bear market — a fall of 20% from recent highs. It was down around 19% from its peak in early January as of Friday's close.
Minutes from the last Fed meeting to be published on Wednesday, and may give traders more insight into the central banks' plans for raising interest rates further.
Fed officials Raphael Bostic and Esther George are due to speak Monday, then data for the central bank's preferred inflation gauge is due Friday.