U.S. Stock Futures Extend Gain on China’s Tariff Olive Branch

(Bloomberg) — U.S. stock futures rose, extending gains in Asian afternoon trading, after China said it will halve tariffs on some $75 billion of imports from the U.S. starting Feb. 14.

Contracts on the S&P 500 Index expiring in March climbed 0.6% as of 2:50 p.m. in Tokyo. E-mini futures on the Nasdaq 100 Index advanced 0.7%, while those on the Dow Jones Industrial Average gained 0.7%.

American equities rallied to an all-time high on positive U.S. economic data and speculation that efforts to minimize the economic impact from the coronavirus will succeed. The S&P 500 has gained 3.4% in three days.

© Bloomberg China’s tariff cut fuels risk-on sentiment

U.S. futures are “looking at continued gains amid the sustained risk-on mood within markets,” said Jingyi Pan, a market strategist at IG Asia. China’s tariff cut “does come as a surprise given the backdrop of the U.S.-China trade issue but represents another slight aid by the Chinese government in light of the coronavirus stress on the economy. For U.S. markets, however, it is just the move to keep the momentum going.”

Shares in Asia climbed Thursday. Japan’s benchmark Topix index extended its gain to 2.5% in the afternoon, helped by the China tariff news as well as Toyota Motor Corp.’s earnings forecast increase.

–With assistance from Abhishek Vishnoi.

To contact the reporter on this story: Kurt Schussler in Tokyo at kschussler1@bloomberg.net

To contact the editors responsible for this story: Lianting Tu at ltu4@bloomberg.net, Naoto Hosoda

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